Standing up to population decline and a super-aging society, raising the nation’s economic growth power, and switching to a sustainable social system — Japan should be the first country in the world to overcome these challenges.
The Yomiuri Shimbun has compiled a proposal toward realizing a society in which people feel more secure about child-rearing and nursing care. The main purpose of the proposal is to strengthen support for childcare and nursing care, and improve the environment so people can balance their work and family lives.
Back up women and elderly people so they can take on active roles in society. Placing a diverse range of human resources into the workplace will spur innovations in corporate activities and raise productivity. The leeway generated in household budgets and the easing of worries about the future would expand consumption and galvanize the economy. This could also improve the birthrate.
Raise public spending
Increasing distribution of resources to childcare and nursing care would propel economic growth. Creating “a virtuous cycle of growth and distribution” would also correspond to the goal of creating a “society enabling dynamic participation by all citizens” advocated by the government.
Measures to be taken by the central and local governments are bound by financial restrictions. Population decline cannot be stopped unless the power of the private sector — including that of companies — is utilized to its fullest. Such a perception of the times is behind the proposal.
The economic foundations have weakened for working generations facing child-rearing and nursing care for their parents. Practices such as lifetime employment and seniority-based wages are in the process of falling apart, while low-wage non-regular workers now account for 40 percent of the working population. Many people in younger generations are unable to get married or raise children.
Public spending on families, including childcare-related expenses, as a percentage of gross domestic product is at the 1 percent level — falling far short of the 3-to-4-percent range seen in European countries. Weak support is another factor contributing to the declining birthrate.
The current social system, premised on the assumption that the economy grows over time and that the population increases, has come to a standstill. Benefits for working generations should be improved by amending the social security system, which overly favors elderly people.
Focus on kids aged 1, 2
The top priority is eliminating the number of children on waiting lists because they cannot enter day care centers. The figure totals about 90,000, including “potential demand.”
Our proposal declares that “nursery care for 1- and 2-year-olds holds the key.” Facilities for this age group, which accounts for 70 percent of the children on waiting lists, should be significantly increased.
Transitioning from kindergartens for 3- to 5-year-olds to “nintei kodomo-en,” which integrate the functions of both kindergartens and nursery schools, is one effective method. It is noticeable that many kindergartens attended mainly by children from households with full-time homemakers are failing to fill all their spots due to the chronically low birthrate and the increase in households in which both parents work. Increased financial support will be needed for this transition.
Small facilities that can be opened in locations such as rooms in buildings and vacant stores should be increased in a flexible manner. Expanding preferential tax treatment will be necessary to urge companies to establish childcare facilities for their employees.
In 2025, the baby boomer generation will be aged 75 or older. As measures to provide reassuring nursing care and combat dementia, our proposal calls for promoting care supporting independent life that prevents people’s conditions from worsening, and the establishment of basic legislation to comprehensively implement steps to fight dementia.
It is vital to boost the quality of life for dementia sufferers and those who need nursing care and reduce the burden shouldered by their families. A system that seamlessly provides necessary services should be prepared through close coordination between medical service providers and nursing care operators.
The childcare and nursing care fields are facing increasingly severe labor shortages. Securing enough human resources is essential for expanding good-quality services.
The average monthly salary for childcare and nursing care workers is ¥100,000 less than the average across all industries. Although the government plans to raise the average monthly salary of childcare workers by ¥6,000 and that of nursing care workers by ¥10,000 from fiscal 2017, the gap with other industries will still be large. Our proposal calls for further improving the treatment of these workers.
Work style reforms will be a major prerequisite for enabling more people to combine a career with raising children or caring for elderly relatives. Allowing women to play a more active role in society and reducing to zero the number of people who quit their jobs to care for elderly relatives will remain impossible to achieve while excessively long working hours remain the norm. Businesses are urged to actively make efforts in these fields.
Finding the funds
Securing revenue sources is essential for providing reassuring childcare and nursing care services.
Japan’s social security costs are ballooning as its society becomes increasingly elderly. The postponement of the planned consumption tax rate hike has jolted the framework for integrated social security and tax system reforms. There needs to be a review of the reform, hinging on more efficient benefit payments and the promotion of steps to ensure people’s burdens are in line with their ability to cope with them.
In contrast to the fiscal deficits, household financial assets have topped ¥1,700 trillion, of which more than half is cash and deposits. Japanese companies also hold internal reserves amounting to about ¥378 trillion. Is there any way these “sleeping assets” can be put to good use?
Issuing government bonds that are exempt from inheritance tax would be a leading option for drawing out individual financial assets, which are concentrated in the households of older generations, into the open market. Although these bonds would have a negative interest rate, they would be exempt from inheritance tax in the future. A main benefit is that, unlike conventional bonds, the government does not face the burden of paying interest on them.
Using the assets of financially comfortable elderly people to strengthen support for working generations would give impetus to the virtuous cycle of growth and distribution.
Companies are encouraged to provide wage increases and boldly invest in measures to support employees’ work-life balance, such as increasing childcare facilities.
Every possible measure should be taken to build a vibrant society.