Photo/Illutration Prime Minister Fumio Kishida gives his policy speech at the Lower House on Jan. 23, the opening day of the 150-day Diet session. (Jin Nishioka)

Prime Minister Fumio Kishida on Jan. 23 pledged to tackle the alarming decline in the birthrate through measures that far exceed the scope of those taken by previous governments.

In his policy speech at the opening of the ordinary Diet session, Kishida also repeated his calls for business circles to raise wages, saying higher worker pay is essential to generate a positive economic growth cycle.

In addition, he said he seriously accepts the strong criticism from the public over connections between politicians and the Unification Church, but he did not delve further into the subject.

Most of his policy speech was centered on Kishida’s vision for a thriving Japanese society.

The declining birthrate has long been a thorn in such programs. And it may be worsening.

The estimated number of newborns in 2022 was fewer than 800,000, a figure that came eight years earlier than the government’s projection.

“We are now only a few weak moments away from reaching a point on whether we can sustain social functions,” Kishida said. “We need to reverse the sliding birthrate.”

He said the government must immediately draw up policy measures for families with small children based on three pillars, including financial support, such as child allowances.

Kishida said a framework for doubling budgets for supporting families raising children will be created by June, when the government maps out its basic policy.

Turning to the “new capitalism” that he advocates, Kishida stressed that wage increases must be achieved.

“If companies that generate profits fully distribute the fruits of the profits to employees, higher personal consumption and further economic growth will result,” he said. “The key to this virtuous growth cycle is pay increases.”

Kishida also said he will push for reform of the labor market to build a structure that can sustain such pay hikes.

“The first necessary step is to increase wages to a level higher than the (recent) rate of inflation,” he said.

Kishida urged companies to transition from traditional seniority-based pay hike systems to ones that better reflect job evaluations to skill levels of workers. Such a shift, he said, would fuel growth.

The prime minister vowed to present a model of how to introduce such merit-based pay systems for Japanese companies by June.

He also explained his plan to drastically strengthen Japan’s defense capability.

Kishida said the government intends to spend 43 trillion yen ($333 billion) over five years from fiscal 2023, an increase of more than 50 percent from the current five-year defense budgets through fiscal 2022.

Kishida said the spending rise will give Japan the capability to strike enemy bases and reinforce its defense systems in the Nansei islands in southwestern Japan.

He earlier announced plans to come up with more than 1 trillion yen through tax hikes to fund the expansion of defense spending in fiscal 2027.

But he did not mention tax increases in his policy speech on Jan. 23.

“We, the people who live now, should respond to the need for funding as our responsibility, rather than pass on the matter to future generations,” he said.

On the question of nuclear energy, he said the government will promote the replacement of retiring reactors with new units and an extension of the operating lives of reactors to a certain extent.

Politicians’ connections with the Unification Church, which is now called the Family Federation for World Peace and Unification, money scandals and inappropriate comments dominated debate in the extraordinary Diet session last fall.

Since the Cabinet reshuffle in August, four state ministers have stepped down over these issues.

“As a politician who values public trust as the most crucial basis of politics, I was overwhelmed by shame,” Kishida said of the resignations. “I will undertake various reforms to prevent a recurrence.”

Kishida brought up the subject at the end of his speech and did not offer details of the planned reforms.

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