Sun, Sep 06, 2009 - Page 5 News List

Kan to head key Japan agency

CRITICAL CHOICES: The prime minister-elect also selected Katsuya Okada to be foreign minister, but said he was not ready to name his choice for finance minister

REUTERS , TOKYO

Japanese prime minister-elect Yukio Hatoyama said yesterday he had picked Naoto Kan, a former health minister, to head a powerful new agency that will oversee the budget process and set policy priorities.

Hatoyama, who will take office on Sept. 16, said that in addition to heading the National Strategy Bureau, Kan, 62, will also be deputy prime minister, and that Katsuya Okada, 56, had been chosen to be foreign minister.

Kan and Okada are former leaders of the Democratic Party of Japan (DPJ) and had been tipped as potential finance ministers. Hatoyama said he would formally nominate them at a party meeting tomorrow.

The DPJ comes to power with ambitious spending plans to put more money in the hands of consumers, raising concerns it could inflate a public debt already about 170 percent of GDP, the highest among advanced countries.

The new National Strategy Bureau, to include both public and private sector officials, will be tasked with reforming what the Democrats have said is a cumbersome policymaking system.

Kan’s experience in tangling with bureaucrats when he exposed a scandal over tainted blood products at the health ministry could stand him in good stead.

The new strategy bureau will seek to implement a Democrats’ promise to bring elite bureaucrats to heel and put politicians back at the center of policymaking.

Although Japanese media had reported Hirohisa Fujii, a former finance minister, was likely to be picked for that post, they quoted Hatoyama as saying yesterday he was not yet ready to name his choice for finance minister.

Fujii, 77, is the head of the DPJ’s tax panel, has called for funding Japan’s social welfare costs with consumption tax revenue and discussing over the next four years the issue of raising the sales tax.

He said Tokyo should not step into currency markets unless exchange rates move abnormally, adding that a strong yen is good for Japan.

The Nikkei Shimbun also reported that Masayuki Naoshima, the party’s policy chief, was likely to hold one of the economic posts.

The Mainichi Shimbun said Hatoyama picked Okada for his connections in the US.

Hatoyama’s choice for the top diplomatic portfolio is being closely watched after concerns emerged that his party’s policy of adopting a more independent stance from the US could damage ties with Tokyo’s biggest security ally.

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