Japanese Prime Minister abandons pay increase after controversy

Japanese Prime Minister Fumio Kishida has backed away from a possible wage increase after controversy arose over his plans to increase wages due to inflation. His government had prepared a bill to increase all government wages, including those of government members.

“If the bill is approved by parliament, the prime minister and ministers have decided to return their increase to the state treasury,” spokesman Hirokazu Matsuno said. Kishida’s annual salary would increase by about 2,850 euros (460,000 yen) under the plan. In total, the prime minister would earn around 250,000 euros (40.6 million yen) per year.

“It is true that the decision to increase the salaries of the prime minister and ministers was criticized by public opinion in Japan,” Matsuno said. “We must avoid creating mistrust.”

Economy in dire straits

Prime Minister Kishida announced a new support plan of more than 100 billion euros for the Japanese economy last week. With these measures he wants, on the one hand, to alleviate the consequences of inflation among the population, and on the other hand, to boost his shaky popularity.

Inflation in Japan reached its highest level in more than forty years at the beginning of this year. For the time being, inflation also remains above the 2 percent target by the Japanese National Bank (2.7 percent in October). These price increases, just like in Belgium, affect the purchasing power of households. Wage increases do not follow at the same pace. The decline of the yen against the dollar and the euro is also weighing on Japanese consumers.