Japanese Prime Minister Junichiro Koizumi admitted Friday that he is guilty of failing to personally pay up mandatory contributions to the national pension plan. The confession has led some to clamor for his resignation. But whether he steps down from the scandal or not, one thing is clear: the country's pension plan is in desperate need for reform.
So far this week, the leader of the nation's opposition party Naoto Kan, whilst he was serving as health minister for ten months in 1996, as well as the chief cabinet spokesman Yasuo Fukuda, have had to resign over their failure to contribute to the plan.
So as Koizumi's advisor Isao Iijima told reporters that the prime minister missed contributing towards the pension plan, and according to some news reports for as much as six years, the heat is on for him to offer an apology, explanation, and perhaps even resignation.
The problem is, if the premier steps down, then he may be taking down more prominent political as well as social figures outside his own Liberal Democratic Party. For instance, Tokyo governor Shintaro Ishihara too admitted that he failed to pay up for over eight years, whilst public figures such as celebrity news anchor Tetsuya Tsukushi have been found guilty of the same crime as well.
The scandal was initially seen as a major blow to the opposition Democratic Party, when its leader Kan was the first to be found guilty and effectively forced out of his post. That more or less killed the prospects of the Democrats ahead of the upper house elections expected to be held this summer. But now that so many LDP members have been found out as well, the scandal has only highlighted the need for urgent reform of the pension scheme.
Regular payment towards the national retirement plan became mandatory in 1986, and many public officer holders as well as corporate employees had failed to switch over to the plan immediately, assuming that their salary-paying organization would automatically deduct from their paycheck to pay up. As such, many of the missed payments were in the mid-1980s largely due to genuine misunderstanding, thus somewhat lessening the culpability of the indiscretion.
As for Koizumi, he has actually not missed any payments since the scheme became mandatory in 1986. Rather, he was delinquent in his payments during the first three months of 1962, when he was still a student. He then failed to pay from August 1969 to March 1970, at a time when he curtailed his studies in London after the death of his father. He was not employed at the time. He then failed to pay as a Diet member from April 1980 to March 1986. The framework of the current pension scheme was established in April 1964, but it was not fully established until 1985.
In his defense, Koizumi said late Friday that he was not guilty of not paying.
"I've always paid when I belonged to the plan. Not belonging and not paying are different," Koizumi said, adding that he felt he had no political responsibility to resign over the matter.
Moreover, Koizumi is far from alone in not joining the plan, and more significantly, many in the population at large have made a conscious decision not to contribute towards the pension scheme from fear that when the time comes for them to retire, the national coffers will be depleted so that they won't be able to get the money they had paid in. By 2050, over 35 percent of the country's population will be over the age of 65.
So given that the Liberal Party is not unique in having its senior members not paying to the plan, and indeed voters may now be tired of a seeming witch hunt of who's paid and who hasn't a few decades ago, its chances in the upcoming elections are no longer as slim as they once appeared earlier this week. That's despite the fact at least 33 party members have been found to be similarly delinquent in their payment. Moreover, the Japanese media subsequently found that Finance Minister Sadakazu Tanigaki and five other cabinet members have also guilty of the same indiscretion, and yet they have all remained in office, much to the chagrin of many voters.
One positive outcome of the scandal has been raising public awareness of the pension scheme, and encourage some to go by the books. Indeed, some local pension bureau offices are reporting that people are waiting nearly three hours just to meet with an official and make arrangements to join up and make payments. But that doesn't mean confidence in the system has gotten stronger. Rather, it has likely made cynics even more wary of the scheme, even if it has pushed otherwise law-abiding citizens to be aware that they would be breaking the law if they don't join and pay, even if it means they will never see their money again.
