LDP proposes revision of Political Funds Control Law, Komeito disagreement stalls progress

The Liberal Democratic Party (LDP) of Japan is forging ahead with its proposal to revise the Political Funds Control Law, despite an unbridged difference with its partner in the ruling coalition, Komeito. The LDP proposal includes lowering the disclosure threshold for purchasers of party tickets from ¥200,000 ($1,900) to ¥100,000, while Komeito has stayed firm at a level of ¥50,000. It is unusual for ruling coalition members not to coordinate their efforts on bills, with the situation resulting in the LDP submitting the bill alone.

Komeito had also advocated external auditing and stronger penalties for Diet members to ensure better accountability. However, the threshold issue remains a sticking point, and the LDP appears to be leaning towards pushing the bill forward itself, given the pressure of the deliberation schedule in the Diet.

Wednesday’s discussions saw the LDP present its draft text to the Komeito, as part of a joint meeting of the political reform headquarters working group and other committees. The LDP proposal also included detailed sections relating to the disclosure of funds provided by political parties to members for policy activity expenses. The idea is to increase transparency and prevent the recurrence of violations of the law that have caused much embarrassment to the Japanese parliament in recent years.

Former Deputy Foreign Minister Keisuke Suzuki, chairman of the working group, said at the joint meeting that political reform was important in various ways and critical in terms of preventing violations of the law. In the past, such violations have led to resignations in both chambers of the Diet and have damaged the reputation of Japan’s legislature.

By making disclosures based on reports from members’ expenditures across five to 10 categories, the LDP hopes to increase transparency on how political activity expenses are used. By breaking down these categories into organizational activity expenses, election-related expenses and research-related expenses, among others, the aim is to address criticisms relating to a lack of transparency in the use of policy activity expenses.

Under current rules, it is not mandatory for members to disclose how they spend political donations, including those from corporations. The fresh initiative comes after scandals involving politicians misusing funds and accepting extravagant gifts hit the headlines in 2018, denting the popularity of Prime Minister Shinzo Abe and hitting his approval ratings.

Observers say that any distinct conflict between the LDP and Komeito could damage their chances in the upcoming Upper House election, scheduled for July. The administration is keen to present a cohesive overall stance on all issues to maintain voter confidence.

As the schedule progresses, the coalition partners will need to come to some conclusion, as the bill has to be approved by both chambers of the Diet before turning into law. The expectation is that the threshold issue will be the focus of heated negotiations in the coming weeks.

The differing levels are crucial in terms of information. Companies must disclose the names of executives and employees who purchase tickets for fundraising parties when they exceed ¥200,000. If the threshold is lowered, around 60% of donations could fall below the reporting requirements. The preference for a lower threshold is geared to increasing transparency and helping to eradicate corruption.

The Prime Minister’s ratings may improve once the bills have been passed, but the political risks are still considerable. Additionally, in his final term, Abe’s approval ratings have continued to drop below 40%, putting his leadership of the party under pressure and potentially creating space for new politicians to make their mark in the years ahead


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