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JAPAN - TOKYO. A US$ 94 billion emergency fund that can be tapped without parliamentary oversight has been branded Japanese Prime Minister Shinzo Abe's "pocket money" by opposition lawmakers alarmed at its unprecedented size.
Abe has said the 10 trillion yen (US$ 94 billion) will allow the government to move swiftly to mitigate the impact of the coronavirus outbreak - a "once in a century crisis" which has devastated the economy.
"We'll report to parliament how we spend the money as needed and at the appropriate time," Abe told parliament on Friday.
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But at 20 times the usual sum for a reserve fund - and roughly equal the amount Japan spends on education and defence combined - the fund has even raised questions from the bureaucrats who have discretion on how to spend the money.
"It's awful," said a finance ministry official. "It's a huge blank cheque that would leave Japan with a bad precedent," said the official, who spoke on condition of anonymity as he was not authorised to speak publicly.
Japan's parliament approved on Friday a record US$ 300 billion second extra budget - including the reserve fund - to finance part of an economic stimulus package of US$ 1.1 trillion.
The issue highlights how Abe, pressed with time and under pressure to match massive stimulus deployed by other major economies, has rankled taxpayers with spending that one of the most indebted nations can ill afford.
"Lawmakers of Abe's ruling party wanted a magical wallet and thought they can get one because we're in a crisis," said independent political affairs analyst Atsuo Ito.
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"Fiscal reform has become a distant goal... The cost of big spending will fall upon the next generation."
Some analysts, however, argue the size is justified given the need to guard against a second wave of infection.
"You need huge sums in reserve when you're dealing with so much unpredictability. You need to be ready for emergencies," said Yasuhide Yajima, chief economist at NLI Research Institute.
