Archive for the ‘Taxes & Welfare’ Category

In Tokyo, all garbage is not created equal

Monday, June 24th, 2013

Why am I blue?: Trash in city-mandated garbage bags waiting to be collected

Why am I blue?: Trash in city-mandated garbage bags waiting to be collected

Two weeks ago the city of Chiba announced that it would start charging noncommercial residents for garbage collection in February. Like many municipalities throughout Japan it will use a garbage bag system: All refuse must be deposited for collection in special bags sold by the city. Presently, Chiba only charges businesses for refuse collection, but the cost of processing garbage continues to go up. In the beginning, residents will pay ¥36 for a 45-liter bag, regardless of whether the trash is burnable or non-burnable. That comes to about ¥0.8 per liter, which will only put a very small dent in the city’s revenue problems. Three years ago Chiba was spending ¥13.3 billion a year on refuse processing, and estimated that 45 liters worth of burnable trash cost ¥280 to dispose of. The same amount of non-burnable trash cost ¥220 to process.

According to Tokyo Shimbun, local governments started charging their residents for refuse collection around the turn of the millennium. Now, about 55 percent of municipalities in Japan do so, and most use the garbage bag system, which only pays for part of the cost. However, the burden on residents varies widely from one place to another, even within the prefecture of Tokyo.

People who live in the 23 wards don’t pay any extra for refuse collection, but those who live in the cities and towns of the Tama region of Western Tokyo pay a lot A woman interviewed in the article recently moved from Ota Ward to Mitaka City. Where she used to live she paid nothing for trash collection, but Mitaka requires that refuse be placed in bags, otherwise it won’t be picked up. A package of 10 purple 40-liter bags costs ¥750.

Continue reading about garbage regulations →

Insurance companies main beneficiaries of scheme to protect obstetricians from malpractice suits

Thursday, June 13th, 2013

In late May, 1,041 former obstetrics patients of 28 medical facilities submitted a plea to the National Consumer Affairs Center (NCAC) to arbitrate a settlement with the Japan Council for Quality Health Care (JCQHC) that would partially refund money they had paid during their pregnancies for insurance purposes. The JCQHC is a foundation that carries out third-party evaluations of hospitals and clinics, but it also oversees a special compensation system enacted by the government in 2009 to protect obstetricians from career-threatening malpractice suits.

The system allows for a form of insurance that all obstetrics patients, meaning pregnant women, pay into. If a fetus or baby suffers brain damage before or during delivery, the insurance pays up to ¥30 million in damages over the next 20 years to the child and his or her parents. This no-fault insurance system was put in place because fewer medical students were opting to become obstetricians, partially because the dwindling birthrate has made obstetrics less profitable, but mainly because malpractice awards in the cases of babies born with disabilities have been extremely high. It was just too financially risky to go into the field.

Pink is the color of the obstetrics department

Pink is the color of the obstetrics department

Unless a pregnancy threatens the well-being of the mother, childbirth is not covered by national health insurance. Though in theory the obstetrics insurance is optional, if a pregnant woman patronizes a medical facility that pays into the insurance system (meaning 99.8 percent of them) they automatically charge her the ¥30,000 premium and incorporate it into her bill. What complicates the matter is the so-called “public aspect” of the system, according to a recent article in Aera magazine.

To encourage women to have babies, local governments compensate them for the money they spent on childbirth after the fact with something called shussan ikuji ichijikin (one-time payment for childbirth), a handout administered by the National Health Insurance Union (NHIU) of up to ¥420,000 per birth, regardless of how much money the patient spent.

This amount includes the ¥30,000 premium that the woman paid for the obstetrics insurance, so in effect the public is paying for the insurance since the NHIU uses taxpayer money as well as national health insurance funds for payments. In that regard, Aera has characterized the JCQHC as an amakudari institution; in other words, a bureaucratic entity whose main purpose is to justify its own existence.

Since the insurance system was launched in 2009, it has paid out about ¥4.1 billion in compensation for damages suffered during childbirth. At the end of the last fiscal year there was still about ¥80 billion in the reserve pool of funds and it is estimated the pool, which is controlled by the five insurance companies, will increase to ¥100 billion by the end of the present fiscal year.

According to Aera, the JCQHC originally estimated that between 500 and 800 babies would suffer brain damage every year out of the country’s 1.2 million births, but real statistics for fiscal 2012 show that only about 200 babies suffered such damage. The mothers who requested arbitration from the NCAC are claiming they overpaid for the insurance and are demanding ¥20,000 each in refunds from the JCQHC. If they win, the organization will have to pay a total of ¥20.8 million. As Aera notes, more than 50 million women have paid this premium since 2009, though, strictly speaking, it is the public who has paid the premiums.

One obstetrician interviewed by Aera says that the reason all medical institutions sign up for the insurance is that part of the law mandates that any medical facility which applies for “high-priced medical care” compensation to the NHIU cannot be approved if it doesn’t pay into the obstetrics compensation insurance plan. Otherwise, the facility can only receive maximum compensation of ¥400,000 for each delivery, regardless of what it cost the facility. That’s too risky for smaller clinics.

The main beneficiaries of the system are the private insurance companies that participate. The premiums are practically free money since the companies are allowed to collect and administer the funds. Also, brain damage resulting in cerebral palsy is difficult to diagnose in an infant, and there is a five-year time limit for insurance claims.

In many cases, developmental disorders arising from brain damage don’t manifest themselves until the child is older and the time limit has passed. However, the insurance companies are also using this aspect to explain why they need such a huge pool of money.

Of children born in 2009 who were eventually found to suffer from cerebral palsy due to brain damage, 12 were discovered in 2009, 100 in 2010 and 158 in 2011. Diagnoses are thus progressive, so the insurance companies say they need this huge surplus to meet future claims. But there has already been discussion in the Diet that the funds should be administered by a government body so as to relieve some of the public burden associated with medical care.

In any event, as some pediatricians have noted, ¥30 million over 20 years is insufficient to take care of most people who suffer from cerebral palsy. They tend to require 24-hour care the older they get. As one mother who is part of the arbitration claim told Aera, a system for compensating brain damage victims directly would be cheaper, more efficient and more humane than the obstetrics compensation insurance, which benefits administrators more than doctors or patients.

The widening income gap is affecting higher education

Tuesday, June 4th, 2013

Students from lower income households have always been able to turn to public institutions of higher learning to make their dreams come true. Public universities, whether national, prefectural or municipal, offered high quality education for much less money. However, a recent survey by a research group at the University of Tokyo has found that the well-publicized widening income gap is now being reflected in public university enrollments.

todai

University of Tokyo

The survey received 1,064 responses from parents of children who graduated high school in the spring of 2012. Households where the annual income was ¥4 million or less were classified as low income, while those whose annual income was ¥10.5 or more were classified as high income.

The percentage of low income students who advanced to a public university last year was 7.4, while the percentage of high income students who did the same was 20.4. In other words, the enrollment rate for higher income students was almost three times that of lower income students.

The research group conducted the same survey in 2006. In that year, 9.1 percent of the lower income students went on to public universities while 11.9 percent of higher income students did, a negligible difference. At the same time the ratio of lower income to higher income students who went on to private universities hasn’t changed significantly since 2006, when the research group concluded that public universities were fulfilling their mission of providing educational opportunities for lower income students. The group can no longer draw such a conclusion.

The reason for the widening gap is that more higher income students are applying to public universities because even they feel the need to save money. Public universities have a limited number of openings for new students, and higher income students tend to do better on entrance tests because they can afford supplemental education, such as juku (cram schools), which lower income students can’t afford.

The survey also asked those parents who thought their children’s academic achievements were “high” whether or not their children actually went on to university. Among these respondents, in 2006, 67 percent of lower income students and 72.9 percent of higher income students advanced to university; while in 2012 the respective portions were 53.3 percent and 76.9 percent.

The research group has called on the education ministry to provide more financial assistance to lower income students so that they can attend and afford university. In 2011 the average annual tuition for a public university was ¥540,000 and for a private university ¥860,000.

City dumps dog tax for yellow cards to deal with lazy owners

Wednesday, May 22nd, 2013

dogdoo

Just doo it: Cleaning up after Fido

About a year ago we reported on a proposed dog tax in the city of Izumisano in Osaka Prefecture. The purpose of the levy was to pay for patrols to enforce a local law mandating that dog owners clean up after their pets. The city’s mayor, Hiroyasu Chiyomatsu, says that because Izumisano is close to Kansai International Airport, the city is a “gateway to Japan” and thus it is embarrassing if the first thing visitors see is dog doo all over the streets.

As it happens, the tax was never passed, since dog owners complained that it was only a minority who broke the law and thus was unfair to punish all of them for the sins of a few. In addition, once it was announced that the patrols were going into effect, the problem actually got worse, since some dog owners misinterpreted the measure to mean that they could leave the droppings behind because the city would be cleaning it up.

So in February the city announced a new strategy. Pairs of inu no fun G-men (dog feces government men) would patrol the city in public vehicles three days a week and whenever they saw droppings on the ground they would place a yellow card on them and leave it there.

If the droppings weren’t picked up for a month, then the G-men would clean it up. The idea is that dog owners tend to walk their pets along the same routes and so will likely see the yellow card and feel guilty enough to clean it up themselves. Only ¥4.6 million has been budgeted for the program, so in order to save money the patrols will be made up of individuals from the local Retired Persons Human Resource Center, whose average age is 75.

So far, the plan seems to be working. In the month before it went into effect, patrols counted 1,736 spots where droppings were left behind, and in the month after it went into effect the number of spots numbered 1,030. Fines will likely go into effect in July.

The ¥1,000 penalty, however, can only be issued when a dog owner is caught in the act — or non-act, in this case. Such issuances may be even be rarer since the patrols only go out in the early morning and late evening. As it stands, many local governments throughout Japan have similar fines for negligent dog owners but few actually collect any money.

There are also other pet problems that the town wants to address, including non-registration of dogs — estimated to be about half — and people who walk their dogs without leashes. About 4,400 people are bitten by dogs every year in Japan.

Should healthy people pay less for health insurance?

Saturday, April 27th, 2013

Finance Minister Taro Aso has been shooting his mouth off again. Tokyo Shimbun reports that at a recent “meeting” he said it “wasn’t fair” that the country had to pay for the medical costs of people who “eat as much as they want and drink as much as they want and then end up with diabetes.”

Japan’s national health insurance does not discriminate between people who maintain good health and those who don’t. You pay according to your income. “Of course, if you have an inherent weakness, that’s another story,” Aso added, obviously recognizing that some people will take offense at his opinion.

Hospital bill for specified elderly patient (over 75), who only pays 10 percent out of pocket.

Hospital bill for specified elderly patient (over 75), who only pays 10 percent out of pocket.

But apparently it’s something he’s thought about a lot. The Asahi Shimbun reports that during opening remarks at a Lower House “party” of some kind Aso said, “I think we should make an incentive for people who are making an effort to stay healthy.”

The government is trying to reduce medical costs, and he believes if someone over, say, 70 continually foregoes treatment for minor complaints that person should be rewarded. “Maybe give them ¥100,000 in cash,” Aso suggested. Then, those people who think they might as well go to the hospital for something small will think twice.

This idea has been floated before, but doctors’ groups, which would suffer financially from such a change in the public mindset, have protested, saying that discouraging people from seeking medical advice for anything is tantamount to killing them.

Aso claims that the average medical cost for a person over 70 is a million yen a year. We couldn’t corroborate that statistic, but fellow Liberal Democratic Party lawmaker Taro Kono, in his email newsletter, said that the average Japanese person costs the government ¥24 million in health care during his/her lifetime — paid for through both insurance premiums and taxes — and that 49 percent of all medical outlays are spent on persons 70 and over.

Then we thought of our own situation. We’ve been paying into the national health insurance scheme for 26 years and reckon we’ve spent almost ¥10 million. We can also count on the fingers of one hand how many times we’ve actually gone to the doctor in those 26 years for something that falls under our coverage, so obviously we aren’t getting our money’s worth — so far.

Employment counselors forced to sit on the other side of the window

Wednesday, April 10th, 2013

The rise of non-regular employment has received a lot of coverage because of its effect on job security in the general work force. A seldom discussed side effect is the acute anxiety experienced by non-regulars as their contracts approach their expiration dates. Will mine be picked up for another year? Will I have to go out and look for a new job next month?

Hello Work website

Hello Work website

For public non-regular employees this emotional roller coaster starts right after Jan. 1, since most contracts end with the fiscal year in March. And for those who have been working in the same position for an extended length of time, there is no solace in the new law that goes into effect this year and which says an employer must hire a contract worker as a regular full-time employee, complete with benefits, if the worker has been in the same position for five years.

Though it’s assumed that many employers will work the loophole by not renewing a contract just before the five-year period is reached and then hiring the person back after a six month “cooling off” period with an open-ended contract, non-regulars who work in the public sector aren’t covered by the new law in the first place. They can be retained as non-regulars indefinitely.

This exception was highlighted when the labor ministry announced that 2,200 non-regular members of its unemployment advisory staff had not had their contracts renewed for fiscal 2013. That represents 10 percent of all the non-regulars employed at Hello Work counseling centers nationwide, and presents an interesting scenario: Former employment counselors who themselves must seek employment advice.

In fact, a Tokyo Shimbun article described one woman in her 50s who received her notice in early March while she still had several weeks on her contract. Though she knew there was always the possibility her yearly contract would not be renewed the lateness of the notice (the media reported the announcement as being “sudden”) caught her off-guard.

In the last weeks of March she was looking for a new job at Hello Work on Saturdays while still working Monday through Friday at the same facility counseling people who themselves were looking for jobs.

One part of the new law that was already in effect before April 1 is to make the practice called yatoidome illegal. “Yatoidome” means nonrenewal of an employment contract for “no good reason,” but, of course, “good reason” constitutes a gray area that the Japanese legal system isn’t equipped to address. It is this part of the law that doesn’t apply to public workers, supposedly because non-regular government employees are only hired as stopgap workers, meaning people employed to fill certain positions on a temporary basis. They do not have to pass a test the way full-time regular civil servants do. However, in many cases, these workers become as indispensable as regular employees. In 2012, 63 percent of all Hello Work employees were non-regulars.

As for why the labor ministry decided to effectively lay off so many employment center staff at one time, a representative told the media that the ministry hired extra contract workers when the recession worsened in 2008 and again after the disaster of 2011, but now the job situation “is stabilizing” so the ministry doesn’t need as many counselors. Some laid-off employees counter this explanation by claiming that their workloads have been heavier in recent months, not lighter, especially in areas most affected by the disaster. What may have sparked the layoffs was the finance ministry, which has been auditing budgets across all government agencies and ministries and demanding cuts.

The yatoidome exception doesn’t just apply to national public workers. One-third of all local government employees, or about 700,000 people, are also non-regulars. That’s an increase of about 100,000 since 2008, according to a labor ministry survey. Of these, 60 percent work more hours than regular employees. More than half of these non-regulars make less than ¥160,000 a month or ¥2 million a year. And because they are technically part-timers, they are not up for promotions or salary increases. The most prevalent jobs in this category of public worker is day care attendant and librarian, but it also includes policemen, firemen and school teachers.

Local government attempts to make citizens rat on welfare recipients

Wednesday, April 3rd, 2013

A goal of the resurgent Liberal Democratic Party is to reduce public welfare expenditures over the next three years by cutting handouts to the tune of ¥67 billion, or about 10 percent. The targets of these cuts are households who receive more money in welfare than do “lower income” households who don’t, the purpose being to bring the monthly payments made to non-working poor families down to or below the monthly earnings of working poor families. Thus the public assistance payment for a family of four would drop from an average of ¥220,000 to ¥200,000.

They call it gambling: Pachinko enthusiasts waiting for their loot

They call it gambling: Pachinko enthusiasts waiting for their loot

As to what this family would have to give up, one category ripe for reduction is “recreation” (goraku), which includes everything from TV sets and PCs to books and magazines. However, according to a 2010 government survey, welfare recipients only spent 6.4 percent of their money on recreation, and due to the LDP’s prime bugbear, deflation, they are spending less in this area all the time, so the keepers of the treasury will have to find other places to cut.

One public figure, however, feels that the goraku category hasn’t been scrutinized enough. The city assembly of Ono, Hyogo Prefecture, passed a law that went into effect April 1 prohibiting people who receive public assistance from the city to use that money for gambling. The law also compels city residents to report any instance of gambling by welfare recipients to the police. Given the timing of the implementation and the nature of the law, some people may wonder if it’s a joke, but Mayor Tsutomu Horai, who wrote it, is quite passionate about the matter, which is why the media have covered it so closely.

Ono currently pays out ¥290 million in welfare annually to 120 households. The population of the city is 50,000. The new law states that anyone who observes a welfare recipient spending “too much money” on gambling has a responsibility to report it to the authorities. The model seems to be local versions of child abuse prevention laws, which state that anyone who believes a child is the victim of violence or neglect must report the abuse to police.

The bill first became publicly known in February, before it was approved, and the city received some 7,000 “opinions” from all over Japan, 70 percent of which were positive. As Horai told the weekly magazine Aera at the time, “Let’s say your friend asks to borrow money because of some trouble, and then later you see him playing pachinko. Naturally, you’re going to be annoyed.”

The problem, as he saw it, was that most people don’t care about public money, and so he wants to change that perception. There is no penalty if a person sees a welfare recipient gambling and does not report it, probably because that would be impossible to prove. Horai certainly understands this, but claims that 90 percent of the city’s residents, including welfare recipients themselves, support the law and so most of his job is already done.

The Hyogo Prefecture Bar Association has come out against the law, saying that its purpose of involving average citizens in the monitoring of welfare recipients’ behavior will result in greater “discrimination of and bias toward” the latter. In fact, Ono’s finances are healthier than most local government’s. Its treasury actually reports a surplus balance of ¥8.5 billion, and the mayor himself has said that the aim of the law is not to reduce the welfare budget. If anything, he hopes the law will also alert people who may qualify for assistance to apply for it.

As it stands, the central government provides three-fourths of a typical handout with the remainder handled by municipalities. About 1.7 percent of the national population receives welfare, while the portion in Ono is only 0.3 percent. However, both statistics are on the rise — the number of recipients in Ono increased by 64 percent over the last five years — and is certainly a reflection of the economic situation in general, but Horai thinks that it has to do with a more relaxed attitude toward government handouts. He told Aera that he first thought of devising the bill when he was at city hall and overheard several people who were waiting on line for their welfare packets. One asked another, “Where are you going to play pachinko later?”

Horai focuses on pachinko, which, legally speaking, isn’t gambling. Players can only earn money by trading the excess balls they win for premiums in the pachinko parlors and then “selling” those premiums at specially established booths outside the premises. Though no one is fooled that this isn’t betting in practice, it’s gambling by legal loophole. What’s more, the off-site payment booths are regulated by the National Police Agency, so why doesn’t pachinko qualify as legal recreation, which is considered acceptable for welfare recipients? And why doesn’t Horai induce citizens to narc on welfare recipients who, say, buy lottery tickets?

Actually, he has an answer to those questions. “People say pachinko is merely entertainment,” he told Aera. “But they don’t understand reality. People who spend too much on pachinko are addicts.” In truth, he wants welfare recipients who play “too much” pachinko to seek medical help, which they can do easily since, as welfare recipients, their medical insurance is free. Horai’s system may not make much sense, but he wants you to know his heart is in the right place.

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