Mon, May 19, 2003 - Page 10 News List

Keidenran will play kingmaker

POLITICAL CLOUT The largest business lobby in Japan will resume recommending which politicians should receive donations, signaling a new era of cash-for-favors


In a bid to regain political clout, Japan's largest business lobby has decided to resume recommending which political parties should get donations from its members, in a move viewed observers as encouraging a cash-for-favors culture.

The Nippon Keidanren (Japan Business Federation), claims the move, which will start next year, will increase transparency of corporate donations.

Japanese politics is already notorious for scandals implicating such funds and analysts voiced concern the plan was a blatant attempt by a special interest group to buy influence to bring about changes that would benefit them.

"[Keidanren] clearly wants to gain political influence. One possible problem is their wishes might not necessarily reflect the public interest," said Shigenori Okazaki, political analyst at UBS Warburg.

Nippon Keidanren, which rep-resents more than 1,500 companies and groups, said last week it would create a committee to prioritize the group's policy proposals.

The committee will also evaluate parties' performance in working toward its proposals and suggest the amount of donation that each party should receive from Nippon Keidanren members.

The committee will also issue guidelines for members about who they should make donations to and how much they should give.

But Hisako Komai, a spokeswoman for the Nippon Keidanren stressed they were only guidelines and member firms would make their own decisions.

"We hope to encourage policy-oriented politics by making clean, transparent political donations," Komai said.

"By putting out clear guidelines as to what policies we support and how much parties should receive, we want to prevent instances where businesses donate money under the table," Komai said, adding that details of the scheme had still to be decided.

The lobby's predecessor, the Keidanren, which merged last year with another business group, scrapped its donations scheme in 1993 over public unease about cozy and sometimes corrupt ties between businesses and politicians, especially members of the ruling Liberal Democratic Party (LDP).

Nippon Keidanren, however, has decided to resume donations to help "activate the Japanese economy and politics as a leader of the private sector," chairman Hiroshi Okuda, who is also chairman of Toyota Motor Corp, said in a statement announcing the move.

Existing tax-funded subsidies to parties, which provide roughly Japanese Yen 50 million (US$416,667) or more per politician, should play a supplementary role, Okuda said.

Nippon Keidanren's scheme is likely to funnel the money again to the conservative LDP, which historically has held the majority in parliament, although it is often associated with bribery scandals, said Rei Shiratori, a political science professor at Tokai University.

Nippon Keidanren is likely to use its influence to push for lowering corporate tax and increase consumption tax, said Okazaki. It may demand a lowering of the corporate burden related to social welfare, such as unemployment insurance, he said.

"To make those goals a reality, they will give money to LDP members, who can force legislation through parliament," Okazaki said.

The lobby should explain in detail why politicians need more money, given that parties are already subsidized, Shiratori said.

"Keidanren is saying that donations should go toward broad, policy-related issues that affect the entire nation. When the effectiveness of the government's economic policies is debatable, as is the case now, who can say what policies really benefit the nation as a whole?" Shiratori said.

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