Japanese Diet Enacts Political Funds Reform

Joshua Paulo
Joshua Paulo
Combining a Criminal Justice and International Relations background, Josh boasts years of experience in various forms of analysis and freelance journalism. He currently spearheads a team of professionals committed to delivering unbiased reporting to provide the public and private sector with accurate and insightful information. Josh serves as Atlas's Director of News.

More From Me

On Wednesday, the Japanese Diet adopted a proposed political funds control law following months of debate and intense criticism off the back of a major slush fund scandal plaguing legacy members of the party. Proposed by the ruling Liberal Democratic Party (LDP; Jiyu-Minshuto), the new legislation aims to reform the rules for funding political parties. However, opposition parties remain unconvinced, arguing that it fails to address the core issues of the scandal.

Background and Enactment

The LDP is currently embroiled in a slush funds scandal that has significantly damaged public trust in both the party and in Prime Minister Fumio Kishida’s administration. The scandal began when it was exposed that several members of former Prime Minister Shinzo Abe’s cabinet had been accepting funds “off the book” during fundraisers and other events. These donations, which went unreported, caused immense distrust for the LDP, threatening to oust them from power. In response, the Diet worked to pass the amended political funds control law before the current parliamentary session ends on Sunday. However, the ripples of such a scandal under Kishida’s leadership have weakened his already fragile position within the party.

Opposition and the No-Confidence Motion

The primary opposition party, the Constitutional Democratic Party of Japan (CDP; Rikken-minshuto), submitted a no-confidence motion against Kishida’s cabinet, which failed the same day despite support from all the opposition parties.

CDP leader Kenta Izumi criticized Kishida for not taking responsibility for the slush fund scandal, arguing that the new law does not go far enough to resolve issues of money influencing politics.

“You’ve been saying that you’ll deliver results one issue at a time. If you consider the revision of the political funds law as one of the results, then you won’t get a pass,” Izumi told Kishida during a parliamentary debate. “It’s time to ask for the people’s judgment.”

Opposition party leader Kenta Izumi (left) of the Constitutional Democratic Party of Japan debates with Prime Minister Fumio Kishida in parliament on June 19, 2024. (Photo – JIJI)

The Japan Innovation Party (JIP; Nippon Ishin No Kai), the second-largest opposition faction, initially supported the bill. However, they reversed their stance, voting against it in the House of Councillors, and accusing the LDP of not fully including their agreed-upon measures – to include stricter rules for policy activity funds.

Party leader Nobuyuki Baba attacked Kishida for failing to include reform to the ¥1 million ($6,340) monthly allocation every lawmaker receives to pay for various expenses, including research, postage, and transportation. The LDP has pushed this issue back, not including it in this parliamentary session, destroying the tentative support JIP provided. JIP also submitted a nonbinding motion to censure Kishida, but the move was rejected.

Prime Minister Kishida’s Stance

Kishida has expressed his reluctance to implement more stringent regulations beyond the revised law, such as a total ban on fundraising. He emphasized the necessity of money in politics, dismissing the idea of banning all fundraising activities as unrealistic.

During his first parliamentary debate in office, Kishida defended the revised law, touting it as a measure to enhance transparency in political fundraising and restore public trust. “I don’t think our work on political reform finishes with the new bill,” he said. “All politicians must persevere in their efforts to restore trust in politics.”

Kishida has also conceded to the Komeito party, the LDP’s junior coalition partner, to ensure the bill’s passage as he faces reelection in September for LDP president. This concession caused temporary discord within the LDP, with prominent members like former Prime Minister Taro Aso and Secretary General Toshimitsu Motegi distancing themselves from Kishida, harming his reelection bid.

Provisions and Critiques of the Revised Law

The new law lowers the reporting threshold for fundraising party ticket sales from 200,000 yen (US $1,260.21) to 50,000 yen (US $315.05). Initially, the LDP proposed reducing it to 100,000 yen, but Kishida yielded to Komeito’s request for a more significant reduction. With this new change, critics argue that the new rule still allows politicians to collect large sums of money by holding fundraising events more frequently, offering a backdoor work around to still maintain “off book” slush funds.

The law also mandates other transparency measures, such as the disclosure of policy activity funds for up to 10 years. However, this point lacks a specific implementation timeline. Kishida has stated that details will be considered at a later date. Notably, the new rules do not ban corporate donations to political parties, a significant source of funding for the LDP. Critics see this as a major loophole that perpetuates the risk of financial misconduct.

Opposition Demands and Broader Political Implications

Opposition parties, particularly the CDP, demanded more radical changes, including powers to punish lawmakers for their staff’s misuse of political funds. During the parliamentary debate, CDP leader Izumi called on Kishida to dissolve the House of Representatives for a snap election in order to allow public judgment on the government’s handling of the slush fund scandal. The opposition is banking on the record low approval ratings to rearrange the Diet. Kishida, however, remained focused on key areas like the economy, avoiding commitment to an election.

JIP leader Baba criticized Kishida for not revising the correspondence allowance. Baba demanded an extension of the current parliamentary session to address this issue and called for Kishida’s resignation.

Public Sentiment and Future Prospects

The Kishida administration’s approval ratings have plummeted in the wake of the scandal. A recent Asahi Shimbun poll indicated that only 19 percent of respondents support Kishida’s cabinet, down from 24 percent the previous month. 84 percent of respondents also believe the LDP will not make any serious changes to the funding structure.

For now, the political landscape remains turbulent, with the revised law failing to satisfy opposition demands for serious reform. The LDP’s reliance on corporate donations and alleged loopholes in the political funding laws continue to attract widespread criticism from both the populace and the opposition parties. Questions have been raised about the effectiveness of the new legislation and mistrust remains high in Japanese politics. As Kishida navigates these challenges, his ability to restore public support and maintain party cohesion under his leadership will be crucial in the lead-up to the LDP’s presidential election in September.