Japanese Trade Union Confederation (RENGO)

Koga Says!
The report of the Special Council on the future of social security

1. Tonight, the Special Council on the future of social security, presided by Chief Cabinet Secretary Mr. Abe, issued its final report entitled “the future of social security”. RENGO appreciates that the report gives a high priority to the linkage between social security and employment policies, specifying as crucial challenges “the common application of employment and social insurance to all employed in principle”, “the improvement of employment and working conditions to reconcile work and child care”, “social responsibility of business for employment”, and others.
       However, the report only walks in the step of existing policies in reviewing individual systems, such as the principle on the integration of employees’ pension plans that was decided by the Cabinet in April 2006. It is far from what it was expected and does not carry satisfactory proposals for “a united reform in overall social security systems”.
   
   
2. The report includes the comment of Mr. Sasamori, a member of the Council and former RENGO President, describing “the basic plan to be covered by the tax” and “the premium of the welfare pension not to exceed 15%”, but only as an annex. The report does not pay proper attention the role of social security to narrow the widening gap and correct the bipolarization.
       On the other hand it is remarkable that the section of “Challenges of social security” specifies proposals that RENGO has been insisting, such as “a universal system of the care insurance”, “the shift of medical expenses from payment by piece rates to payment by fixed amount”, and “the review of the overall health care system for the aged”.
   
   
3. The Council was established upon the request of RENGO and the Japan Business Foundation both of which requested “the basic plan to be paid by the tax” and “the premium of the welfare pension not to exceed 15%” at the time of the 2004 pension reform. It was also established on the basis on the supplementary provision to Pension Amendment Law saying “a united reform of overall social security systems shall be discussed”. Nevertheless, the report only emphasizes self-help and a tax-base basic plan not to be put off, but it is lacking in looking at a unified reform in overall social security systems, including tax and fiscal reform.
       The report also describes that the pension and health insurances should cover all based on the principle of social insurance as mutual help. However, the reinforcement of collecting premiums by itself cannot be a fundamental solution to the high rate of the insured who have not paid and those who have not joined the plan, as well as to illicit exemption of premiums that has been disclosed recently.
   
   
4. RENGO will request the Government to continue providing a forum to discuss a united reform of social security and also individual issues, such as the measures to ensure that all join the plan and pay their contributions, the merger of employees’ pension plans and a universal system for care. Furthermore, RENGO will work to realize a real integration of pension plans, including the basic plan to be paid by the tax, by raising wider public opinion, targeting the 2007 regular session of the Diet where the introduction of a bill to merge employees’ pension plan is discussed.