SME-bullying finance bill railroaded through Lower House

Japan Press Weekly

Japan Press Service Co., Ltd. is the only news agency providing information of progressive, democratic movements in Japan

SME-bullying finance bill railroaded through Lower House

The ruling Liberal Democratic and Komei parties on November 6 used the force of majority to get a House of Representatives approve a bill to help banks rebuild themselves by using tax money.

The bill was put to a committee vote on November 5, after 4 days of discussion in the House of Representatives Committee on Financial Affairs. The Japanese Communist, Democratic, and People’s New parties voted against the bill.

Prior to the vote at the committee meeting, JCP Sasaki Kensho took the floor to criticize the government for seeking to have the capital injection bill enacted without taking necessary steps to encourage financial institutions to issue new loans to small- and mid-sized enterprises (SMEs).

Pointing out that the bill abolishes the existing system that requires financial institutions to set goals to lend money to SMEs and calls responsibility of shareholders and management into question over their failure to meet the goals, Sasaki stated, “The need now is for the government to prevent financial institutions from refusing to offer finance for SMEs or conducting forcible debt collection practices, and directly support smaller businesses.”

He also argued that excessive financial speculation has caused reductions in the capital adequacy ratios of financial institutions.

He said, “The entire banking industry should secure funds necessary for financial stability on its own responsibility. In doing so, self-discipline and mutual-monitoring functions will be established within the industry.”

Referring to the fact that Prime Minister Aso Taro on October 30 vowed to increase the consumption tax in three years, Sasaki severely criticized the government for imposing a consumption tax hike on the public while providing generous capital injection into banks. - Akahata, November 6, 2008