Economic recovery urgent as welfare recipients hit record high
(From The Japan Times November 29 issue)

The health and welfare ministry announced Nov. 9 that the number of people on welfare receiving livelihood assistance known as seikatsu hogo (literally livelihood protection) reached 2,050,495 nationwide as of July, topping the monthly average record of 2,046,646 in fiscal 1951, when Japan was in the midst of postwar social and economic confusion. Behind this is an increase in the number of elderly people and prolonging economic stagnation.

Especially worrisome is the fact that the number of working-age people who cannot find jobs and have to rely on livelihood assistance is rapidly increasing. The effects of the 3/11 disasters and the euro zone crisis may worsen the situation. There is no quick fix. It is important for the central and local governments to take effective measures to stimulate the economy, and to help unemployed people find jobs.

The number of welfare recipients started falling in the mid-1980s amid an economic bubble. But it started rising after bottoming out in fiscal 1995 when the monthly average of recipients was about 880,000. It started soaring after the Lehman Brothers shock in the fall of 2008 and topped 2 million in March this year.

Every month in fiscal 2010, an average 1,410,049 households (1,952,063 people) were on welfare, a record number and a rise of 135,818 from fiscal 2009. Of them, 43 percent were households of elderly people; 33 percent households with disabled or invalid people and 8 percent mother-and-child households.

Attention should be paid to the fact that the percentage of “other households” on welfare, which include households of unemployed working-age people, rose from 10 percent in fiscal 2009 to 16 percent in fiscal 2010 — about twice the corresponding percentage 10 years before. This July, the category consisted of 251,176 households, about four times the corresponding figure 10 years before.

In the past, elderly people accounted for most of the recipients of livelihood assistance. But the situation has completely changed from the years of high economic growth. If working-age people have lost jobs these days, it is extremely difficult to find new ones. If the period for receiving unemployment insurance benefits expires, sustaining their life becomes difficult. About 30 percent of new welfare recipients in fiscal 2010 cited the loss or reduction of breadwinners’ income — the largest percentage among reasons to go on welfare. In addition, one-third of Japan’s workforce is irregular workers, such as part-timers and temporary workers. They are not fully covered by unemployment insurance. Under current conditions, many working-age people have no choice but to receive livelihood assistance once they lose their jobs.

In fiscal 2010, the total outlay for livelihood assistance reached some \3.4 trillion. The central government shoulders three-quarters of it and local government the remaining quarter. The outlay for fiscal 2011 is almost the same on a budgetary basis. If the number of recipients of the assistance increases, the central and local governments will face financial trouble. In many municipalities, the livelihood assistance outlay accounts for more than 10 percent of their general account budgets.

Problems related to livelihood assistance have been reported — such as people receiving the assistance while hiding income, medical institutions giving unnecessary treatment to welfare recipients to get medical service payments covered by livelihood assistance, welfare recipients having psychotropic drugs prescribed with the aim of earning money by reselling them and businesses ripping off people on welfare for low-grade accommodations offered to them.

A careful approach is required in solving these problems because livelihood assistance is the last-resort social safety net based on Article 25 of the Constitution, which says, “All the people shall have the right to maintain the minimum standards of wholesome and cultured living.”

Many elderly people have no choice but to rely on livelihood assistance because they have no income or their pensions are extremely low, although drastic reform of livelihood assistance is necessary because it was designed when Japan was enjoying high economic growth and its population was increasing.

The most important thing is for the central and local governments to make strenuous efforts to ensure economic recovery. They also should consider raising the minimum wage to give welfare recipients incentives to work.

日本語の抄訳はウィークリー12月10日号のP18に掲載されています。