Misuse of social insurance should not be allowed
Japanese Prime Minister Fumio Kishida’s package to combat birthrate shrinking, mentioned in the column in the Financial Times on 12 March, is very poorly received in Japan.
This is to raise health insurance premiums from 2026 to secure new funding for one trillion yen (6.7 billion US dollar) to boost the birth rate. There are severe problems with this policy. First, this is a misuse of premiums. Furthermore, though the premiums are determined according to income, a ceiling on the amount is set. Therefore, the burden on middle-income groups will increase relatively more. In other words, the package will result in households with children being hit instead of supported.
Kishida insists on omnes pro uno to justify it, but that entirely does not make sense. If the aim is to redistribute income, why not establish it as a new tax? His excuse shows a glimpse of his desire to dodge public criticism of tax increases.
In retrospect, politicians have used this unfair practice of mismatching benefits and burdens for their convenience without public consent. In the last three decades, the growth of the social insurance burden was more than double that of the tax burden in Japan.
The root cause of Japan’s declining birthrate is that politicians have been timid about criticism of tax increases and shied away from dialogue with the public. This is nothing but negligence.