Voters Strike a Blow Against the Kishida Administration

But not a knock out punch

By Takuya Nishimura, Senior Fellow, Former Editorial Writer for The Hokkaido Shimbun
The views expressed by the author are his own and are not associated with The Hokkaido Shimbun
You can find his blog, J Update here.
April 29, 2024. Special to Asia Policy Point

On Sunday, April 28, voters firmly rejected the Kishida administration and the Liberal Democratic Party (LDP). In three by-elections of the House of Representatives, the LDP lost all three seats. The Constitutional Democratic Party (CDP) won all three races.

The results reflect public frustration with Kishida’s handling of the slush fund scandal and the LDP’s slow progress on political reform. The elections dealt a significant blow to Kishida’s efforts to preserve his administration.

By-elections are held twice a year, ordinarily in April and October, when a seat of any district of both Chambers of the Diet is vacant, either by resignation of a lawmaker, death or for other reasons.

One of the three by-elections, the election in the Shimane-1 district, followed the death of the former Speaker of the House of Representatives, Hiroyuki Hosoda. Hosoda was the head of the Seiwa-kai faction, also known as the Abe faction, which was at the epicenter of the slush fund scandal. Hosoda was also suspected of having close ties to the Family Federation for World Peace and Unification, the former Unification Church, and of having sexually harassed a female reporter.

In the one-on-one match-up in Shimane-1, Akiko Kamei of the CDP defeated Norimasa Nishikori of the LDP by a margin of 25,000 votes. It was almost the same as Hosoda’s winning margin in the last election in 2021. Swing voters who voted for Hosoda three years ago shifted to Kamei.

Kamei’s victory was the LDP’s first loss in this highly conservative district since the current election system was introduced in 1996. Although the Shimane branch of the LDP has been split since the gubernatorial election in 2019, the result of the by-election is widely interpreted as a protest by LDP supporters against Kishida’s indecisive handling of the slush fund scandal.

The second by-election, held in the Tokyo-15 district, filled a vacancy left by the resignation of the former LDP Representative, Mito Kakizawa. He stepped down after his arrest on suspicion of bribery in a mayoral election in Koto city, Tokyo. The LDP did not have a candidate on the ballot, and the election became a contest among nine candidates of the opposition parties.

Natsumi Sakai of the CDP won the race, with the support of the Japan Communist Party. Sakai’s victory showed that the CDP and the JCP can work together successfully in a race that does not include a LDP candidate. The Japan Innovation Party, or Nippon Ishin, took third in the race. A candidate supported by the popular governor of Tokyo, Yuriko Koike, came in fifth.

The third by-election was held in the district of Nagasaki-3 after the resignation of Yaichi Tanigawa. He had been indicted on charges of receiving over 40 million yen in kickbacks from the Abe faction. The LDP did not have a candidate in the race. The CDP’s Katsuhiko Yamada won the seat with 53,000 votes, twice the number of votes that Ishin’s candidate received.

The message of the results in Tokyo-15 and Nagasaki-3 is that voters who gave up on the LDP turned to the CDP, rather than to Ishin. Although the LDP did not field a candidate in two of the three districts, the LDP was seen as suffering defeats in three elections. “It was an extremely severe result. We hope to restore confidence through accumulating efforts for political reform and leading political agenda to solution,” said LDP Secretary General, Toshimitsu Motegi, on the night after the elections.

Defeat in Shimane was a particularly significant blow to the Kishida administration. Typically, the prime minister will join campaigns only for winnable districts in a general election. Kishida unusually campaigned in Shimane-1 twice. The LDP’s loss surely tarnished Kishida’s reputation.

The LDP tried to avoid outright voter rejection by not offering candidates in Tokyo-15 and Nagasaki-3. But the sweeping victory by the CDP and low voter turnout in those two districts showed considerable resentment of old-style LDP politics – the undisclosed use of political funds. The results in the two districts may signal a trend in other districts all over Japan. Indeed, they may mark the end of the era of LDP’s unilateral domination.

The results of the by-elections shocked LDP lawmakers. They will now be forced into close races in the next election. They will certainly oppose a snap election. An attempt by Kishida to call one in June would instigate a movement in the LDP to replace Kishida. Party members will look for a leader who can reduce the number of victims of an unpopular leader in next election.

So far, such a movement has not materialized. Leaders of the Abe faction had questioned Kishida’s leadership. But they have been inactive since they were subjected to severe penalties in the aftermath of the slush fund scandal.

Although Motegi or former Premier Yoshihide Suga have tried to rally some in LDP, there is not a movement for either. The most popular figure to replace Kishida, Shigeru Ishiba, has not decided to run for the presidential election. A strange silence has descended on the LDP. But it is likely that someone or something will ignite a movement against Kishida, as the party heads to the presidential election in the fall.

Even the CDP cannot be optimistic about the next general election. Their three victories were the result of LDP errors. A framework of electoral cooperation is essential if other parties are to replace an LDP administration. The Head of the CDP, Kenta Izumi, once told reporters that it would take five years for CDP to achieve a regime change. It is up to Izumi to build a viable strategy quickly to replace the LDP in the next general election.

Diet Political Reform Committee Reestablished

Outcome Still Uncertain

By Takuya Nishimura, Senior Fellow, Former Editorial Writer for The Hokkaido Shimbun
The views expressed by the author are his own and are not associated with The Hokkaido Shimbun
You can find his blog, J Update here.
April 22, 2024. Special to Asia Policy Point.

Both Houses of the Diet have established special committees for political reform to develop legislation to regulate the management of political funds. The committees are to address the public’s distrust of politics, which arose from the slush fund scandal in the Liberal Democratic Party’s (LDP) factions. Although Prime Minister Fumio Kishida hopes to bring about a consensus among the parties in these committees, it is still unclear whether he can.

Establishing a “special committee” beyond what already exists is a routine tactic for a ruling party to show regret for their wrongdoing. Both the Lockheed Scandal in the 1970s and the Recruit Scandal in the 1990s led to special committees even though each House already had a permanent committee to examine such scandals. This time, each chamber established a special committee for the slush fund scandal by reorganizing their existing committee for political ethics and electoral reform.

Kishida has shown his willingness to undertake reforms to political contributions and expenditures to prevent another slush fund scandal. The opposition parties have been looking for opportunities to accuse the LDP of only minor reforms of the party’s fundraising scandal. But no party disagreed with the establishment of the special committee. The parties are instead focus on matters of substance.

In the slush fund scandal, no leader of the Abe or Nikai factions was arrested or indicted, while accounting managers and private secretaries were. The three lawmakers indicted on charges of receiving excessive funding were not the leaders of a faction. Accordingly, an important point for political reform is how the leaders take responsibility.

One option is to impose heavy penalty on lawmakers who were involved in a scandal. Revoking membership in the Diet would be such a penalty. Not only the opposition parties, but the LDP’s coalition partner, Komeito, is willing to introduce such a measure. Komeito has been sensitive to criticisms from their own supporters about its cooperation with the LDP.

The LDP has revised its internal rule that the party would suggest (but not require) a leader to leave the party or have his party membership suspended whenever the accounting manager of his campaign is arrested or indicted. The leader then would be urged again to resign from the party or face expulsion. if the accounting manager is found guilty. Most LDP lawmakers oppose enacting this rule on their view that the loss of Diet membership is too heavy a punishment for a slush fund scandal.

Article 251 of the Public Offices Election Act would be a model for revocation. Under this article, a candidate’s electoral victory will be cancelled if his or her accounting manager is found guilty of bribery or a similar offense. LDP lawmakers distinguish, however, between receiving slush funds and taking bribes.

A second approach would be to ban contributions from companies or organizations. This has been under discussion for a long time with no end in sight. Currently, the Political Funds Control Act (PFCA) allows companies and organizations to contribute to a lawmaker’s campaign organization, but it prohibits direct contributions to a lawmaker personally. The LDP has learned how to exploit this rule; the opposition parties demand a total ban on contributions from companies and organizations.

A third possibility is the abolition of “policy activities fund,” a fund controlled by a party that contributes to individual lawmakers. The LDP maintains such a fund. A lawmaker who receives such funds does not have to disclose the contribution or his use of the funds. The opposition parties argue for the abolition of these funds. Komeito requires its members to disclose their use of contributions from its policy activities fund. The LDP is basically negative on abolition of the fund and any disclosures about it.

Finally, the Diet could place stricter limits on the fundraising parties, which are the source of the current scandal. The opposition parties, which do not hold such events, are urging for this reform. The Constitutional Democratic Party would ban any type of fundraising party, while the Japan Innovation Party and the Japan Communist Party propose a prohibition on the purchase of party tickets by companies and organizations.

Currently a company must report any ticket purchases to a particular party of 200,000 yen or more. Komeito has proposed lowering the threshold to 50,000 yen. The LDP has suggested only the abolition of fundraising parties by factions. Private fundraising parties by lawmakers would be untouched.

A fifth reform that the LDP is considering is an independent third-party audit of each fund-raising party. But the LDP’s overall reluctance to regulate campaign contributions comes from a lack of seriousness among LDP lawmakers. No opposition party has the power to replace the LDP as the leading party. There is also an aspect of the slush fund scandal that is a power struggle among LDP factions.

The April newspaper polls conducted last weekend showed, once again, a low approval rating for the Kishida Cabinet. Some polls did indicate a minor boost, possibly the result of his visit to the United States. This may not be enough to sway the electorate. The by-elections scheduled for April 28 may bring an unexpectedly negative result for Kishida and his party. Given continued public distrust of the LDP, it remains unclear whether the Kishida administration will survive the current political crisis.

The LDP's Moral Hazard

No Punishment for the LDP President

By Takuya Nishimura, Senior Fellow, Former Editorial Writer for The Hokkaido Shimbun
The views expressed by the author are his own and are not associated with The Hokkaido Shimbun
You can find his blog, J Update here.
April 8, 2024. Special to Asia Policy Point

The Liberal Democratic Party (LDP) recently announced punishments against the lawmakers who had been involved in the slush fund scandal that emerged last December. But for a few scapegoats, the punishments were light.

Of the 82 lawmakers with the former Abe or Nikai factions who admitted to failing to report surplus funds from ticket sales to fundraising parties, only 39 were punished. Prime Minister Kishida, as the president of the LDP, was not punished, leaving many frustrated.

Five former leaders of the Abe faction received the stiffest penalties. Four out of the five participated in discussions in the Abe faction in 2022 on whether to abolish the kickback system. Despite their leadership responsibilities, they took no action.

The harshest sanctions were imposed on the former chair of the Abe faction, Ryu Shionoya and the former leader of that faction’s House of Councillors’ membership, Hiroshige Seko. They were asked to leave the party. If they did not so within the allotted time, they would be expelled. Seko immediately left the party. Shionoya is considering whether to appeal: “I cannot accept that unjustly heavy penalty, which was imposed on the members of Abe faction making them scapegoats,” said Shionoya in a press conference.

Former Minister of Economy, Trade and Industry, Yasutoshi Nishimura, and former Education Minister, Hakubun Shimomura, received lighter penalties: they were suspended from party membership for one year. Former Chair of LDP Diet Affairs, Tsuyoshi Takagi, who succeeded Nishimura as the secretary general of the Abe faction in late August of 2022, was suspended from party membership for just six months.

Nishimura, Shimomura, and Takagi could run for re-election, but they will not have the official backing of the LDP until their suspensions end. If an election is called before then, they will face an uphill battle without financial support from the party.

As to the other 77 party members, they all avoided heavy penalties. Sanctions on the 77 were calibrated by the amount of funds they failed to report.

In contrast to the former leaders of the Abe faction, the former Chair of the LDP Policy Research Council, Koichi Hagiuda, and former Chief Cabinet Secretary, Hirokazu Matsuno, were suspended only from leadership posts for a year; there was no suspension from party membership. Hagiuda and Matsuno have been important in the Kishida administration, which probably helped them escape more serious penalties. Seven lawmakers who were the leaders of Nikai faction or who failed to report funds in amounts over 20 million yen received the same one-year suspension from leadership posts.

Eight lawmakers who did not report surplus funds of between 10 and 20 million yen were suspended from leadership positions for six months. Seventeen others who did not report between five and ten million yen were merely reprimanded Forty-three lawmakers each of whom failed to report less than five million yen, were not punished at all. That is, the LDP did not impose any penalty on over half of the lawmakers involved in the scandal.

A few thoughts come immediately to mind. First, Kishida’s highest priority is reelection as LDP President. The power of the Abe faction has been an inconvenient truth for Kishida. Although discovery of the slush fund scandal was unexpected, it gave Kishida an opportunity to control that faction, but not to dismantle it. That would have posed too great a risk since it would solidify opposition to him.

Second, Kishida’s strategy in the scandal is to divide and rule. One of the lightly punished leaders, Haguida, has gained Kishida’s personal trust as evidenced by his temporary consideration for appointment as Chief Cabinet Secretary in last September’s cabinet reshuffle. The other, Matsuno, was Kishida’s original choice for CCS at the beginning of the Kishida administration. Kishida hopes to keep Hagiuda, who has many colleagues in Abe faction, and Matsuno close to him. The other – more heavily punished – leaders in the Abe faction did not have close relationship with Kishida.

Third, Kishida cannot punish too many lawmakers because he does not want to create too many enemies in the LDP. If the penalized lawmakers were to leave the party, it would take away votes in the Diet that Kishida needs to pass legislation. Kishida limited the heaviest penalties to the five leaders of the Abe faction. Shionoya and Seko must be the scapegoats to defend his administration from public criticism and further decline in his approval ratings.

Striking this balance between punishment and leniency in the LDP is unlikely to enable Kishida to salvage his administration from the quagmire of scandal. The punishments were far smaller than those in 2005, when Prime Minister Junichiro Koizumi sanctioned the lawmakers who voted against a postal reform bill. Those lawmakers simply defied a policy of the president of their party and did not violate the law. This time, the lawmakers did break the law.

The lack of any punishment for Kishida brings a moral hazard. Kishida has led his faction since before the scandal was revealed last December. An accounting manager in his faction was indicted on a charge of failing to report 30 million yen of political funds. While the leaders of the Abe faction were punished for failing to meet their leadership responsibilities, Kishida escaped any.

It is difficult to punish the president. Even a light penalty, such as suspension from party leadership position, could lead to the resignation of the president, or Prime Minister. Yet a zero penalty can hardly be balanced against the heavy ones for the Abe faction leaders. The only reasonable choice is to step down. Kishida has not chosen this option.

“I have an impression why was he [Kishida] dropped,” said Shionoya in his press conference, “He should be responsible for something, at least in lights of his position as the LDP president or as the head of a faction.” The opposition parties are taking the offensive and pushing for a snap election to hear voters’ voices about LDP politics. While Kishida hopes to raise his approval rating with some achievements in the summit meeting with US President Joe Biden this week, public frustration against an irresponsible prime minister will stick around.

Apology at the LDP’s National Convention

Snap Election not yet 

By Takuya Nishimura, Senior Fellow, Former Editorial Writer for The Hokkaido Shimbun
The views expressed by the author are his own and are not associated with The Hokkaido Shimbun
You can find his blog, J Update here.
March 18, 2024. Special to Asia Policy Point

Japan’s Liberal Democratic Party (LDP) held its annual national convention in Tokyo on March 17. The party decided to amend its constitution to impose stricter penalties on its members who were involved in the slush fund scandal. Prime Minister Fumio Kishida, LDP president also apologized for the scandal that increased public distrust of the government. Although Kishida repeated his hope for the restoration of confidence in the LDP, he remained unsuccessful in raising the approval rating for his cabinet, casting a dark shadow on his future.

Kishida’s speech at the national convention dealt with party reform to restore confidence in the LDP. “I am very sorry that party members received criticism from the local community on the slush fund scandal. We are amending laws related to political funds and urging related lawmakers to take full responsibility for the scandal,” he said. He added that he had ordered the Secretary General to penalize the lawmakers who were involved in the scandal.

The national convention is the meeting for decision-making in the LDP. Its agenda includes approving a platform for the year. This year the platform calls for political reform in light of the regret about mishandling of political funds by several factions, including Kishida’s own. The platform proposes amending the Political Funds Control Act, the LDP constitution, and other internal rules to ensure transparency of political funds.

The slush fund scandal affects the party activities of the LDP’s local branches. In a meeting of the secretary generals of the prefectural branches, held on the eve of the national convention, local LDP leaders complained about the mishandling of the scandal by party leaders in Tokyo. They demanded punishment of the offending lawmakers as soon as possible. Kishida responded, “I am going to make my best effort risking my life for revitalizing the party.”

The LDP failed to agree on the kind of penalty that should be imposed on each lawmaker involved in the scandal. The LDP listed 82 lawmakers, each affiliated with the Abe or Nikai faction, who had received secret funds from their faction. Although Kishida was not listed, he was the former head of his faction, The faction’s accounting manager has been found guilty of false reporting of the funds. It remains to be seen whether Kishida can avoid responsibility for the management, or rather mismanagement, of his faction.

The lawmakers involved in the slush fund affair have not taken heed of Kishida’s urging that they explain their involvement in the scandal. In the Deliberative Council on Political Ethics in the Upper House, one of the five leaders in Abe faction, Hiroshige Seko, said that he did not know about any secret funds of the Abe faction, even though he knew about the kickback system in the fundraising parties. The lawmakers who appeared on the council in both Houses repeatedly said that they did not know about the secret funds.

Kishida’s inability to put to rest the criticisms about the slush fund scandal further affects the approval rating for his cabinet. While the approval rating for the Kishida Cabinet was up one point, to 22% from 21% over the past month, according to Asahi Shimbun mid-March poll, the disapproval rating rose by 2 points to 67% over the same period. This was the highest disapproval rating since the LDP retook the ruling position in 2012. Polls in Mainichi Shimbun and Sankei Shimbun showed low approval ratings around 20%, although they showed a little improvement from February.

Kishida is focusing on the by-elections in the House of Representatives in late April to regain power in his administration. These elections will show how frustrated the public is with LDP politics. “If implementing policies is an aspect of politics, elections are another. Recognizing sharp criticisms against our party, though, I’m going to do my best to win the by-elections,” said Kishida to party members at the national convention, demanding unification of the party in its current difficult situation.

The election campaign in each district is far from hopeful for Kishida. In the Nagasaki 3rd district, where a lawmaker indicted for the false reporting of political funds resigned, Kishida has reportedly decided not to offer a LDP candidate. It is unusual for a ruling party not to enter any candidate in a district election. By default, this by-election will be counted as a defeat in one of the three by-elections.

A LDP lawmaker from the Tokyo 15th district was arrested last December on suspicion of violating the Public Official Election Act. He was found guilty in Tokyo District Court last week. The LDP has not found a new candidate for this by-election. Although the LDP is hopeful that it will have a candidate in the Shimane 1st district, it is not easy to win there. The former representative of the district was the late Speaker of House of Representatives, Hiroyuki Hosoda. The Shimane LDP faces an uphill battle because Hosoda was one of the former heads of the Abe faction, which was responsible for the slush fund scandal.

If the LDP loses all the three by-elections, there will be serious thought given to replacing Kishida. The results of by-elections typically foreshadow the results in the next general election of the House. The Representative of LDP’s coalition partner Komeito, Natsuo Yamaguchi, has rejected an early snap election, saying that Kishida should not call for dissolution of House of Representatives until the LDP has restored public confidence for its politics.

In the discussion of the Upper House Committee on Budget on March 18, Kishida denied he would call a snap election before LDP concludes determining penalties for the lawmakers involved in the slush fund scandal.

Apart from the slush fund scandal, Kishida’s political situation is not so bad. Reflecting a booming economy with stock market rallies, corporations announced unusually high increases in workers’ compensation in their annual negotiations with labor unions. The Bank of Japan followed by deciding to scrap its negative interest rate policy. An official visit to the United States in mid-April and a tax reduction in June should boost his administration. However, public distrust of Kishida may be too strong to overcome.

An Insufficient Political Reform Draft

Protecting Privilege

By Takuya Nishimura, Senior Fellow, Former Editorial Writer for The Hokkaido Shimbun
The views expressed by the author are his own and are not associated with The Hokkaido Shimbun
You can find his blog, J Update here.
March 9, 2024. Special to Asia Policy Point

Japan’s ruling Liberal Democratic Party (LDP) on March 7 presented its members with a draft plan for political reform. Revisions are proposed to the party’s rules, disciplinary regulations, and governance code, including a ban on traditional factions. Although LDP lawmakers criticized party leaders for loopholes in the draft, they reluctantly approved it.

The draft imposes tougher penalties on lawmakers whose staff is arrested or indicted for involvement in illegal activities involving political funds. The draft also provides for the expulsion of any lawmaker whose accounting manager is convicted for a violation of the Political Funds Control Act.

The LDP Political Reform Headquarters, headed by Prime Minister Fumio Kishida, has held discussions over party reforms from the beginning of this year. In an interim report from the headquarters late January, the party proposed banning factions from dealing with political funds and from involvement in the selection of ministers or party board members.

The draft of political reform was offered at the March 7 meeting concluding discussions over the past two months. It is expected to be approved in the national convention scheduled for March 17.

There are some rules that apply to LDP itself. The draft revises the Party Constitution, the Party Discipline Rules, and the Governance Codes. For example, Chapter 8 of the LDP Constitution establishes the Party Ethics Committee and the Political Ethics Hearing Committee. The March 7 draft proposes that the Political Ethics Hearing Committee can request the Secretary General to convene the Party Ethics Committee, when a party member or a policy group violates the Ethics Charter in the Party Discipline Rules. The Political Ethics Hearing Committee can also recommend that the Secretary General take necessary measures when an activity of policy group needs to be improved.

The preamble of the Party Discipline Rules establishes political ethics to secure public confidence in politics and requires each party member not to lose the trust of the people. When an accounting manager is arrested or indicted on a charge of violating the Political Funds Control Act, the draft empowers the party to impose on the lawmaker one of five penalties: suspension of appointment to party officials, recommendation to resign from the Diet or government, deregistration as an official candidate of the party in elections, disqualification as a party member, or a recommendation to leave the party.

If an accounting manager for a member is found guilty (after appeals are exhausted) of a violation of the Political Funds Control Act, the party will recommend that the lawmaker leave the party or be expelled. The expulsion clause was highlighted in news reports as the point of revising party rules after the slush fund scandal.

The Governance Code is a relatively new rule, having been introduced in 2022. The Code sets forth the responsibilities of party members and transparency of the party in order to maintain public confidence in the LDP. The March 7 draft adds to the basic principles of the code “strict treatment on the issue of political funds.” Defining “faction” as an organization, which tries to maximize its power and increase its membership, whenever it is backed by the power of money and can influence appointments to posts in the government or party board, the draft prohibits maintenance or establishment of this kind of faction. And it also prohibits policy groups from holding fundraising parties and obliges them to have an external audit.


Changes to the Governance Code do not include the elimination of factions, because it allows factions in the form of policy study groups, to which the definition of “faction” is not applied. There were some complaints in LDP that the definition did not extend to all political organizations.

The LDP has so far failed to disband factions. The party released a Political Reform Guidelines in 1989, when LDP was involved in the Recruit scandal of receiving unlisted stocks. The Guidelines have yet to be implemented. The Guidelines provide for three actions to initiate abolishing a faction: 1) the supreme adviser leaves the faction, 2) the president, vice-president, secretary general, chair of general council, chair of policy research council, chair of Diet members of Upper House, and ministers in cabinet leave the faction, and 3) the officials of the factions do not take action as if they are making party decisions.

In early 2000s, Junichiro Koizumi supported the abolition of factions. He left his faction when he became Prime Minister. However, the result of the “Koizumi reform” was that the Koizumi faction, Seiwa-kai, was subsumed by Yoshiro Mori. Under the Koizumi administration, the Mori faction grew to be the biggest faction in the LDP. It was succeeded by Nobutaka Machimura, Hiroyuki Hosoda, and Shizo Abe. Now, it is cynically expected that the factions will be reborn in the LDP, notwithstanding the latest reforms.

LDP will limit factions in the party organization by ending their role in the selection of personnel for governmental minister and party board posts. Nothing in the draft, however, excludes the influence of factions, or policy study groups, in the appointment process.

The March 7 draft also does not refer to which part of the national laws the LDP plans to amend. Although LDP urges tougher penalties for violations of the Political Funds Control Act, the opposition parties demand the resignation of any lawmaker if his/her accounting manager is conclusively found guilty of violating the statute. Some opposition parties also propose a total prohibition on donations from the business sector or organizations such as trade unions. The LDP has shown no sign of acceding to this demand.

The draft did not touch on penalties by the LDP on the lawmakers who were involved in the slush fund scandal. In the discussion in the Deliberative Council on Political Ethics in the House of Representatives, former Prime Minister Yoshihiko Noda insisted that Kishida punish those lawmakers. Kishida answered that the LDP would decide on sanctions. Young lawmakers in the LDP are frustrated that the leaders of the Abe faction have not taken responsibility for their false control of political funds.

The opposition parties argue that the revisions of the LDP’s internal rules are too weak to guarantee transparency and establish ethics in politics. But the LDP has not put its own ideas for amendments of the Political Funds Control Act on the table in the negotiations with the opposition parties. The LDP remains reluctant to have hearings on all 32 lawmakers who have been requested by the opposition parties to appear before the Deliberative Council on Political Ethics in the Upper House. The failure to make much progress undermines the political basis of Kishida administration, which continues to have low approval ratings.

Unusual Appearance of Prime Minter Kishida before the Ethics Council

An unsatisfying occurrence

By Takuya Nishimura, Senior Fellow, Former Editorial Writer for The Hokkaido Shimbun
The views expressed by the author are his own and are not associated with The Hokkaido Shimbun
You can find his blog, J Update here.
March 2, 2024. Special to Asia Policy Point

The first example of an incumbent prime minister’s appearance before the Diet’s Lower House Deliberative Council on Political Ethics (DCPE) occurred last week. The DCPE was established in 1985, two years after former Prime Minister Kakuei Tanaka was found guilty in Tokyo District Court of involvement with the 1976 Lockheed Bribery Scandal that damaged Japanese politics.

On February 29, Prime Minister Fumio Kishida sat before DCPE to take questions about the slush fund scandal. He apologized for losing public confidence in politics as the result of the scandal. Despite his hope to restore that confidence, Kishida was not successful in removing all the doubts about the control of political funds in the LDP.

Kishida’s original plan was to have the DCPE meet on February 28 and 29 and to have the Lower House send the FY 2024 budget bill to the Upper House by March 1. But the meeting on February 28 was cancelled because some lawmakers from the former Abe faction refused to attend and to take questions from the committee if the meeting was open to the public. If it had been held as a closed meeting, it was obvious that the Kishida administration would have been seen as not serious about restoring public confidence in political ethics.

Making the second surprise this year, after the dissolution of his faction in January, Kishida decided on the morning of February 28 to attend the public committee meeting to explain the scandal, hoping to break the deadlock that was delaying the budget. His unusual decision helped the LDP to agree with the opposition parties to hold committee meetings on February 29 and March 1. As part of the deal, the budget bill passed the Lower House in an unusual weekend session on Saturday, March 2.

An isolated prime minister is emerging from the process. Even when Kishida orders LDP lawmakers to fulfill their responsibility to explain the scandal, they are reluctant to follow him. Lawmakers in the Abe faction have been frustrated with Kishida’s leadership since he fired all the Abe faction ministers when the scandal unfolded last December. Kishida’s trilateral cooperation with two other faction leaders, Taro Aso and Toshimitsu Motegi, has weakened after Kishida unilaterally announced the dissolution of his own faction.

As for the Nikai faction, its former secretary general, Ryota Takeda, tried to protect his boss, Toshihiro Nikai: “While Mr. Nikai is apparently the symbol of our faction, he has nothing to do with any office work or accounting,” said Takeda at the PEC meeting. By contrast, Kishida has no follower defend him as Takeda did for Nikai.

Was Kishida successful in the Q&A session of the DCPE on February 29, anyway? The short answer is no. He proposed an amendment to the Political Funds Control Act seeking heavier penalties for lawmakers whose staff engaged in illegal activities. He also said he is considering an official LDP punishment for members who were involved in the slush fund scandal. He promised to have no more private fundraising parties during his term as prime minister. Critically, however, he failed to explain the truth of the scandal.

The committee members from opposition parties asked when, by whom, and for what Abe faction’s “kickback system” had been established. The system returned to a member the proceeds of ticket sales for fundraising parties beyond the member’s quota. Kishida said that the return of excess proceeds had begun at least ten years ago. But everyone already knew that because that was revealed in the LDP’s internal survey. “We could not find exactly when and how it had been established,” said Kishida.

Another point was why the Abe faction resumed the kickbacks, even after Shinzo Abe, as the president of the faction, decided to abolish that practice in the spring of 2022. Kishida explained that LDP, which had no power to enforce its requests for information, could not find everything. Asked whether he made a request to former factional president and former Premier, Yoshiro Mori, Kishida simply answered that there had been no reference to Mori in the LDP survey.

The facts of slush fund scandal were made rather clearer in the Council on March 1 with the attendance of four leaders of the Abe faction: Yasutoshi Nishimura, the former Minister of Economy, Trade and Industry; Hirokazu Matsuno, the former Chief Cabinet Secretary; Ryu Shionoya, the former Minister of Education; and Tsuyoshi Takagi, the former chair of the Diet Affairs Committee of the LDP. Nishimura, Matsuno and Takagi were former secretary generals of the Abe faction, and Shionoya chaired regular meetings of the Abe faction after Abe died.

On when the kickback system started, Matsuno told of his experience. He learned of the kickback system after he became a lawmaker and joined the Abe faction in 2000. The president of the faction at the time was Jun-ichiro Koizumi, and the prime minister was Mori. Shionoya said that the system was established over 20 years ago to help young lawmakers who could not raise political fund by themselves.

How Abe’s decision to abolish the kickback had been reversed was still not clearly explained. Nishimura, who was the secretary general of the Abe faction at the time, recalled that Abe decided in a meeting in April 2022 to end it out of his concern that the obscurity of the fund would invite doubts about the integrity of the LDP. Nishimura then said that some members requested the LDP leaders to resume the kickback system after Abe was shot to death in July.

Although Nishimura said that no conclusion was reached during an August 2022 meeting, Shionoya remembered that they talked about keeping the kickback system at least for 2022. Opposition party members quickly noted the contradiction. However, no Abe faction leaders could name who requested the resumption of kickbacks or who decided to continue it. They also denied that they had recognized the illegality of the kickbacks, even after Abe decided to abolish it.

Another big question was how the kickbacks had been spent. All four leaders said that they had been used for political purposes. If the kickbacks were sent from the faction to the political organization of each lawmaker as a donation and were used for political purpose, then they would not be taxed. But if a kickback was treated as the private income of the lawmaker, it would be taxed. Matsuno explained that some funds were kept in his office in cash and some to support meetings with lawmakers, but he did not reveal who were at the meetings.

According to the discussions in the DCPE the facts in the Abe faction were as follows: someone started the kickback system over 20 years ago and Abe decided to end it in April 2022; Abe was unfortunately assassinated three months later, and someone wanted to be given his surplus funds back; the system was reactivated in 2022 by whom no one knows; no one realized that the kickback was illegal even though it was not recorded on the political funds report; and the funds were used only for political purposes.

The opposition parties were not satisfied with this story and demanded further investigation in the Diet. There are some options going forward: asking other leaders to speak in the PEC, inviting the former president of the Abe faction to the Budget Committee hearing, or establishing new special committee for investigation. Whatever the next step, the scandal is still hanging around.

Japan’s Diet Investigates the LDP’s Slush Fund Scandal

Kisha tries to keep it contained

By Takuya Nishimura, Senior Fellow, Former Editorial Writer for The Hokkaido Shimbun

The views expressed by the author are his own and are not associated with The Hokkaido Shimbun
You can find his blog, J Update here.
February 18, 2024. Special to Asia Policy Point

On February 15, the ruling Liberal Democratic Party (LDP) released the result of interviews of its members who were involved in the slush fund scandal. These politicians had received money from their factions from the ticket sales in fundraising parties beyond their quota. The interviews revealed that many faction members were aware of the secret practice, thus inviting skepticism on the ethical principles of the LDP.

As a result, the opposition parties have demanded a thorough disclosure the LDP’s fundraising practices. Prime Minister Fumio Kishida, hoping to quell discontent, has made up his mind to accept the opposition’s request for lawmakers to take questions at the Diet’s Special Committees on Political Ethics in each Chamber.

An investigation team in LDP, headed by the chair of General Council, Hiroshi Moriyama, conducted interviews of 85 members who had accepted funds from their factions or kept them for themselves. Of the 85, 82 were lawmakers, and 3 were branch chiefs planning to run for next general election of House of Representatives. 79 were affiliated with the Abe faction and 6 with the Nikai faction, both of which were dissolved after the scandal was revealed.

The investigation team found that 32 members of the 85 interviewed had recognized that the money they received was the return of ticket sales beyond their quota. Eleven members out of the 32 knew that the funds had not been reported to the government –-meaning that they knew the funds were kept secret.

Regardless what kind of the fund it was, 53 members out of the 85 had already spent the money, partly or totally, for their political activities. The other 32 kept it in their offices. The activities included payments to their staff and for meetings, or for the purchase of cars, books, souvenirs, and lunchboxes. Is buying books or lunchboxes political activity? The members might have explained that the books were distributed to people outside of their election districts and that lunchboxes were for staff members at lunchtime events. If the items had been distributed in a member’s district, they would be regarded as illegal donations.

The total amount of the secret funds of the 85 members interviewed was ¥579 million. The lawmaker who had spent the most was the former Secretary of General, Toshihiro Nikai: ¥35 million. Nikai’s political organization once explained that it had bought about 28,000 copies of books, worth ¥34 million, for three years between 2020 and 2022. Nikai’s argument that he read this number of books is ridiculous and serves only to increasing public skepticism about his use of the money.

While the interviews were made for promoting political reform, Kishida knows well that it was not enough. “Taking every opportunity,” said Kishida, “the related members have to take responsibility for regaining people’s credibility.” Now that public prosecutors have finished their investigation of the slush fund scandal and have indicted three lawmakers and other accounting managers of factions, it makes sense for the Diet to look into how LDP lawmakers were involved with the secret funds.

The opposition parties demanded that the LDP convene the Special Committee on Political Ethics in both Houses, where the lawmakers would explain their roles. Although the LDP was reluctant to accede to that demand, Kishida ordered the LDP leaders to consider holding hearings. He is afraid of public frustration with the strange expenditures of tax money by LDP lawmakers.

A Special Committee on Political Ethics was established in each House in 1985, when the Lockheed Scandal shook Japanese politics. A committee meets at the request of any lawmaker who wishes to explain an ethical problem or when one-third of all committee members request a meeting, and a majority of the committeeapproves it. Eight lawmakers have appeared before the committee and answered questions in the past. All eight were members of House of Representatives.

A hearing before one of the special committees differs from hearings before other committees in two important respects: the special committees do not take sworn testimony, and the hearings are usually closed to the public. By contrast, the Committee on the Budget of each House sometimes invites witnesses to testify under oath in public hearings. Under the Diet Testimony Act, any untruth is subject to the penalties for perjury.

Over time, special committees’ approach has sometimes worked for investigations on important political incidents. In this case, however, even if one of the special committees meets in this Diet session and if a member asks that the hearing be open to the public, it is unlikely that the entirety of the scandals will be disclosed.

The opposition parties regard the special committee in the House of Representatives as the first step in scrutinizing the LDP’s scandal. The parties have requested that 51 LDP members appear before the special committee, hoping to question all the members interviewed in the LDP investigation except members of House of Councillors. If the question-and-answer sessions are insufficient, the opposition parties will ask for sworn testimony later on.

It is likely that Kishida will treat a meeting of the special committee as a bargaining chip in negotiations over the FY 2024 budget bill. If the bill passes the House of Representatives 30 days prior to the end of March, that is, by March 2 the budget will be in place at the beginning of FY 2024. However, any meetings of the special committee to hear from the 51 LDP members involved in the scandal will take a long period of time, jeopardizing passage of the budget bill.

The focus in the LDP so far is on whether the five leaders of Abe faction will appear before the special committee. Four of the five leaders, except Hiroshige Seko, are the members of House of Representatives. While young lawmakers in the Abe faction are frustrated with the leadership of the former faction, the five leaders insist on their innocence, stressing that the secret fund was managed without notice to them. It depends on Kishida’s leadership whether these members will answer the questions about slush funds in the special committee.

Kishida Administration Grilled by Opposition Parties

CCS Hayashi

And it is inconclusive

By Takuya Nishimura, Senior Fellow, Former Editorial Writer for The Hokkaido Shimbun
The views expressed by the author are his own and are not associated with The Hokkaido Shimbun
You can find his blog, J Update here.
February 10, 2024. Special to Asia Policy Point

In the Japanese Diet, the Budget Committees of both Houses are where the hottest political issues are discussed between lawmakers and government officials. Last week, starting on February 5, Prime Minister Fumio Kishida was grilled by members of the Lower House Budget Committee over his handling of political reform within the ruling Liberal Democratic Party (LDP) and his appointment of cabinet ministers connected to the controversial Unification Church. Kishida’s strategy is to give the opposition parties vague and inconclusive answers.

The Budget Committee hearings are the highlight of the Diet session every year and are ordinarily scheduled a week after the Q&A in the plenary session after the Prime Minister’s annual policy speech. While the Q&A in the plenary session is in the form of prepared questions and answers, a Budget Committee hearing is an unscripted debate within the time allocated to every party. The hearing is nominally about the budget bill submitted to the Diet, but the opposition parties ask about everything, because the budget bill deals with everything.

In the Budget Committee of the House of Representatives (Lower House), the opposition parties demanded to know the purpose of contributions by the LDP to its leaders. It was reported that former Secretary General Toshihiro Nikai had received ¥5 billion from that fund over five years. While LDP is continuing to investigate the failures to disclose cash distributions from each LDP faction to its members, the party’s own fund, which covers “policy activities expenses,” has been untouched by the slush fund scandal because this fund is not subject to disclosure requirements.

Kishida asserted a principle of “freedom of political activity” to defend the secrecy of the LDP’s expenses. “Freedom of political activity and people’s right to know should be balanced,” Kishida told the Secretary General for the Constitutional Democratic Party, Katsuya Okada. “Once the fund was disclosed,” Kishida argued, “it reveals business secrets of companies or organizations, and strategic plan of party will be leaked to the rivals in politics, or even to foreign countries.”

It is hard to understand why Kishida so strongly opposes disclosures about the LDP fund. The opposition parties are skeptical about the money, supposing that it must be used for things they cannot explain. It is not strange for people to imagine that the money must have ultimately been handed to local supporters, just as in the bribery cases of Katsuyuki Kawai in Hiroshima or Mito Kakizawa in Tokyo.

The opposition parties even referred to a possibility of tax evasion. Yuichi Goto (CDP) insisted that the leaders who received funds from the LDP may well have evaded income taxes, if they took unused funds and failed to report them on tax returns. A witness from Ministry of Finance testified that the receipt of surplus cash from the LDP may be a taxable event. Kishida reiterated that he would not explain the use of the fund.

Opposition party attacks on Kishida’s leadership have not been limited to reforms in response to the slush fund scandal and have spread to his appointments of ministers of his administration. Asahi Shimbun reported that the Minister of Education, Culture, Sports, Science and Technology, Masahito Moriyama, had received the support of the Federation for World Peace (FWP), an organization connected to Family Federation for World Peace and Unification (FFWPU, better known as the Unification Church), in the 2021 election. In October 2023, Moriyama’s ministry sought a court order to disband the FFWPU.

According to a series of reports by the Asahi, Moriyama accepted support from FWP for his election campaign, including a telephone bank staffed by FWP members, urging voters to vote. The newspaper also reported that Moriyama had signed a policy accord with FWP before his appointment. The accord included an agreement to support legislation to amend the constitution to enhance security as well as legislation to teach family values and to give children a moral education. He was also asked to caution voters against promoting LGBTQ rights and same sex marriage.

Moriyama’s ministry oversees religious corporations. Once entering into a policy accord with the FWP, Moriyama became responsible for implementing these policies even after he became minister. Obviously, the ministry’s neutrality on these policies was compromised.

In the hearing before the Lower House Budget Committee, Moriyama vaguely recalled that he had received some support from FWP. The next day, however, he refused to provide clear answers about the nature of his relationship with the FWP, repeating “I have no memory of it.” Kishida rejecting a request to replace Moriyama, said that Moriyama had terminated his relationship with FWP.

When the fact of a meeting with a person connected to FFWPU in 2019 was revealed last December Kishida said that he did not know who was in the meeting. The memory of Kishida also has a certain ambiguity.

Questions surrounding that meeting involve not only Moriyama but also another minister closer to Kishida. Chief Cabinet Secretary, Yoshimasa Hayashi, admitted to having a meeting with FWP officials before the 2021 election. In his daily press conference, Hayashi said that he was not sure about who was there in the 2019 meeting and what they talked about. The Harvard grad also has memory issues.

Watching Kishida’s mounting troubles, some LDP leaders have begun to act. Former Minister of Defense and former LDP Secretary General, Shigeru Ishiba, held a meeting with his colleagues, which he maintains as policy study group. The minister in charge of Economic Security, Sanae Takaichi, gave a lecture to a conservative group.

The activities of these quasi-factions in the LDP began only one week after the largest group, the Abe faction, and some other factions announced their dissolution. These are inconvenient facts for Kishida who will base his leadership on ending factions and promoting political reform in the LDP when he seeks reelection as LDP president this fall. More questions will be coming from the Upper House Budget Committee in its hearing with the Prime Minister in March.

Far From Political Normality in Japan

Kishida Adrift 

By Takuya Nishimura, Senior Fellow, Former Editorial Writer for The Hokkaido Shimbun
The views expressed by the author are his own and are not associated with The Hokkaido Shimbun
You can find his blog, J Update here.
February 4, 2024. Special to Asia Policy Point

Having partly dealt with the slush fund scandal in the Liberal Democratic Party (LDP), Prime Minister Fumio Kishida hopes to re-focus on substantive policy issues such as disaster relief in the Noto Peninsula and passage of the FY 2024 budget bill in the Diet. However, the slush fund scandal is not over. The opposition parties have proposed various political reforms, but Kishida’s response is weak. His administration still operates far from political normality.

The ordinary session of the Diet in 2024 started with an unusual schedule. The customary policy speech by the Prime Minister on the first day of the session was delayed this year because the opposition parties demanded that the Committee of Budget in both Houses discuss political reforms beforehand. The LDP had no choice but to agree to debates, given public interest in political reform as a result of the slush fund scandal.

In the debates, the opposition parties proposed such political reforms as a complete prohibition on fundraising parties or the disclosure of funds raised for the parties that were then distributed to lawmakers. Forced into a defensive position, Kishida apologized for inviting a situation in which the LDP has lost public confidence. But he left the direction of political reform to the discussion among the parties, without offering any of his own ideas.

If Kishida were not shackled to the scandal, this Diet session should have been a stage for him to fight deflation. In his policy speech after the debates in the committee, Kishida stressed the opportunity to remove deflation and to introduce a phase of new growth with his “new capitalism” of wage hikes and positive investment. “With every effort, I am going to achieve a wage increase beyond price hikes,” said Kishida.

Since the Diet session is the first since the Noto Peninsula earthquake on January 1, Kishida pledged ¥1 trillion toward recovery in the stricken area. “I am responsible for the policies from getting the people back to their hometown to revitalization of the region,” Kishida emphasized.

The customary speech of a Prime Minister is also customarily followed by a questioning session with representatives from each party. Questions from the opposition parties this time focused on political reform. The head of the Constitutional Democratic Party, Kenta Izumi, demanded that Kishida request all the LDP members who were involved in the secret funds scandal to resign. The incoming chairwoman of the Japanese Communist Party, Tomoko Tamura, asked Kishida to prohibit any kind of donation from companies or organizations.

Kishida’s answers were ambiguous. Regarding resignations, Kishida said that he would consider making a request in the future after the lawmakers involved in the scandal explain their roles and the LDP fully grasps the facts. It is not clear what action Kishida is going to take. On the donations a from a company or organization, Kishida stressed the freedom of political activity for companies and organizations and said that such donations would not be inappropriate.

While Kishida has been facing harsh criticism from the opposition parties in the Diet, the discussion within the LDP of political reforms remains unsettled. The Abe faction announced on January 31 that it had not included ¥676 million in its political fund reports between 2018 and 2022, and declared the dissolution of the faction, ending its 45-year history, in its last regular meeting on February 1.

The chairperson of the Abe faction, Ryu Shionoya, apologized to its members, saying that he was feeling like his gut was torn apart. But some young members called for Shionoya’s resignation as a lawmaker in expiation for the faction’s scandal. Some members revealed that they had been instructed by the faction not to report the secret fund. Shionoya refused to resign and said that the responsibility of the leaders would be determined sometime in the future. It is fair to say that the rule of the Abe faction in the LDP for the two decades, starting from the time of Junichiro Koizumi administration, has ended.

The outflow of members has not ended Motegi faction. Following the lead of the chair of the LDP Election Strategy Committee, Yuko Obuchi, several lawmakers in both Houses decided to leave the Motegi faction. The remaining members of the Motegi faction have decided to continue its activities as a policy study group without weekly regular meetings. The Kishida faction has decided to close its office and finish its activity as a policy group.

The only faction that has not stepped back (if not dissolved) is the Aso faction. But the faction’s leader, Taro Aso, is creating his own gaffes. In a speech in the Fukuoka prefecture last month, Aso decided to describe the appearance and age of the Minister for Foreign Affairs, Yoko Kamikawa. “From the viewpoint of us, this aunt is doing good. She is not that beautiful, though,” said Aso.

The ensuing criticism has gone beyond Aso to Kamikawa, who did not protest Aso’s remarks. Kishida left a boilerplate comment in the discussion of the Diet that members should refrain from mocking someone’s age or appearance.

The LDP has started to interview its members to obtain details on the slush fund scandal. “Even though the factions are dissolved, the responsibility of related people for explaining what happened will remain,” said Kishida in the Diet. Some members of the opposition parties would like to invite LDP lawmakers a hearing on the scandal or to establish a special committee to investigate. Beyond answering questions in the Diet, Kishida seems to have no idea of how to navigate through this political crisis.

Will the LDP reform?

Kishida’s Halfway Political Reform

By Takuya Nishimura, Senior Fellow, Former Editorial Writer for The Hokkaido Shimbun
The views expressed by the author are his own and are not associated with The Hokkaido Shimbun
You can find his blog, J Update here.
January 27, 2024. Special to Asia Policy Point

On January 22, the Liberal Democratic Party’s (LDP) new Political Reform Headquarters released its “interim report” in response to the slush fund scandals of several LDP factions. Although the report proposes banning factions from hosting fundraising parties and eliminating the role of factions in money-raising and in appointments to cabinet posts and the party board, it does not ban factions. Missing from the report are the details of the scandal – an absence likely to exacerbate rather than quell public frustration with the LDP. Since the LDP has no specific plan to issue a final report, discussion of the scandal and the appropriate response to it has carried over to the Diet.

The Tokyo District Public Prosecutors Office investigated the scandals in which three LDP factions kickbacked to members the proceeds of ticket sales for fundraising parties that exceeded the quotas assigned to the members. The factions did not include the payments on their required political funds reports. The office has now wrapped up its investigation with the indictment of three lawmakers, all of whom are affiliated with the Abe faction, and seven accounting managers.

The prosecutor’s office did not, however, indict seven leaders of the Abe faction who were under investigation. While they were suspected of receiving kickbacks, the leaders explained that they did not know about the money since payments were the responsibility of the faction’s accounting managers. Although criminal prosecutions will not occur, it still is possible that the Committee for the Inquest of Prosecution will discuss the propriety of the non-indictments. Some in the LDP expect further penalties for the leaders, perhaps including expulsion from the party.

The interim report begins with an apology to the public for the kickback scandal. “The people doubt LDP with alleged inappropriate accounting over fundraising parties by specific factions,” says the report, emphasizing that the scandal has been about some specific and not all factions in the LDP.

The interim report calls for enhanced transparency of fundraising so as to prevent future mismanagement. The report also recommends the elimination of fundraising parties by factions and third-party audits for every faction. These recommendations assume that factions will continue to exist; the report does not speak to their possible elimination.

The report has loopholes. Although it would bar faction-led fundraising parties, it does not discuss such parties by lawmakers directly, which could present the same opportunity for kickback scandals. At one time, an LDP faction was group of lawmakers united by an influential leader who was powerful enough to distribute political contributions to faction members. Fundraising parties by individual lawmakers could bring back the old politics of control by bosses.

Also absent from the interim report is any discussion of “political activities spending,” which are distributions by the party to its leaders; how these funds are spent is not disclosed to the public. According to a report of Asahi Shimbun, the LDP distributed fund totaling ¥1.4 billion to fifteen leaders in FY 2022. Secretary General Toshimitsu Motegi received the lion’s share, ¥971 million. As long as factions exist, these distributions will continue, even if the LDP tries to stem the flow.

The report does urge that the factions return to their traditional role as genuine study groups. The report defines factions as “entities for studying policy and complementing party with political education.” But the LDP already has study groups. The LDP Policy Research Council has fourteen divisions, which hold meetings every morning for the study of policies with specialists or scholars. The LDP must explain the difference between these newer divisions and traditional factions as genuine policy groups.

Also requiring explanation is the recommendation to end the factions’ role in appointments to posts in the government and the party board. If this role is to end, the LDP needs to clarify how the party will elect the president. Article 10 of Rules for election of President requires at least 20 party Diet members to nominate a presidential candidate. Until now, nominations have rested on a balance of factions. With the loss of this role for the factions, the twenty members may constitute an informal, quasi-faction.

Disappointed with the report’s confusing approach to factions, some lawmakers have announced that they will leave their factions. The chair of Election Strategy Committee, Yuko Obuchi, will leave Motegi faction. Former Minister of Defense, Takeshi Iwaya, will resign from the Aso faction.

There have been other arguments about political funds, which are not addressed in the interim report. Some have argued that the threshold for reporting the names of buyers and the amount of ticket sales for a fundraising party should be lowered from ¥200 thousand to ¥50 thousand. This approach would be effective in regulating political funds because identification of the ticket buyers may deter local supporters.

Requiring the resignation of any lawmaker whose staff was arrested or indicted mismanagement or failure to report political funds should be another option. The Public Office Election Law already strips a candidate of an election victory if a staff member committed illegal activities such as bribery. This provision could be expanded to cover the mismanagement of political funds.

LDP’s coalition partner, Komeito, and the opposition parties support the recommended reforms on political funds. The reforms are matters for the Diet since amendments to laws will be necessary. The ordinary session of the Diet was convened on January 26. During a discussion in the Diet on January 29, Kishida appeared willing to consider a “guilt-by-association” system that hold lawmakers responsible for political funds control law breaches by their staff. Nevertheless, he was reluctant to disclose political activities spending. Kishida will face hard questions during in the rest of the current Diet session that ends June 23rd.

Kishida's Survival Gamble

Taro Aso Will his administration survival? By Takuya Nishimura, Senior Fellow, Former Editorial Writer for The Hokkaido Shimbun The views expressed by the author are his own and are not associated with The Hokkaido Shimbun You can find his blog, J Update here. January 21, 2024. Special to Asia Policy Point The Special Investigation Division of the Tokyo District Public Prosecutors Office has mostly wrapped up its investigation into the Liberal Democratic Party’s (LDP) slush fund scandal. They indicted some Abe faction lawmakers and the accounting managers of the Abe, Nikai, and Kishida factions. To restore public confidence in politics, Prime Minister Fumio Kishida announced the dissolution of his faction. Although the Abe and Nikai faction also agreed to be dissolved, the remaining three LDP factions--Aso, Motegi and Moriyama—have not. Kishida’s abrupt and unilateral decision threatens to bring about a sharp rift in the LDP. The Asahi Shimbun has reported that the public prosecutors indicted two lawmakers in the Abe faction, Yasutada Ono and Yaichi Tanigawa, on charges of violating the Political Funds Control Act. The two are specifically alleged to have failed to report funds from the faction that were derived from the sales of tickets for fundraising parties. On January 7, prosecutors had already arrested a lawmaker, Yoshitaka Ikeda. Ono was indicted in house and has denied any involvement in illegal activities. Tanigawa received a summary indictment and admitted the charge against him. Both men have left the LDP and Tanigawa has submitted his resignation from the Lower House. The accounting managers of three factions allegedly failed to report the funds relating to their faction’s fundraising parties, including the return of some proceeds of the fundraisers to the lawmakers. Amounts not reported include ¥1.3 billion for the Abe faction, ¥380 million for the Nikai faction and ¥30 million for the Kishida faction. Strangely, leading lawmakers in the Abe faction, including the “Five Guys,” were not indicted. Prosecutors interviewed them about the management of their money, but apparently did not find sufficient evidence of their participation in reporting violations. The leaders explained that the head of the faction, either former Prime Minister Shinzo Abe or former Speaker of House of Representatives, Hiroyuki Hosoda controlled the unreported funds. Coincidentally, both men are deceased. Abe ended the “kickback” practice, but his successors in the LDP reversed the decision after he died in July 2022. The leaders of the Abe faction and the accounting manager said in their interviews with the prosecutors that the accounting manager decides whether the funds would be reported or not. Prosecutors failed to ask who was responsible for the decision to resume kickbacks. Another question: What is the difference between the lawmakers who were arrested or indicted and the ones who were not? Asahi and other news media have reported that the charging threshold was ¥30 million. Ono, Tanigawa and Ikeda are suspected or charged with failing to report ¥40 to ¥50 million of funds, while the Abe faction failed to report less than ¥30 million. It is true that the Abe faction’s unreported amount is lower than in the cases of the Japan Dental Federation in 2004, in which the Heisei Study Group, currently the Motegi faction, received ¥100 million, or of the office of Ichiro Ozawa, which failed to report ¥2.1 billion in 2010. However, the Abe faction has run its kickback system for nearly two decades. Ordinary people will have a hard time understanding the decision not to indict Abe faction leaders. Predictably, the approval rating of Kishida’s Cabinet did not show any upsurge (Asahi: from 23% to 23%, Yomiuri: from 25% to 24%) after the indictments were announced. Kishida had at first underplayed the reporting failures, but he changed his tune after Asahi reported the prosecutors’ plan to indict not only people with the Abe and Nikai factions, but also some with Kishida faction. He abruptly announced the dissolution of his faction to show his commitment to party reform and to limit further damage to his administration’s public standing. Kishida did not consult with other factions before announcing the dissolution of his faction. The announcement came as a surprise, if not a shock, to the LDP. Following Kishida’s announcement, the Abe and Nikai factions, both of which handled greater amounts of slush funds than the Kishida faction, called urgent assemblies and declared the dissolution of their factions. Although Kishida did not demand that other factions also dissolve, his decision effectively destroyed the two other major factions. The other three factions are in a difficult position. They are not alleged to have failed to report political funds, but they are the subject of guilt by association. The factions have stressed the positive aspects of factions as policy study groups. The leader of the Aso faction and the vice-president of LDP, Taro Aso, told Kishida that he would not dissolve his faction. This faction, as well as the Motegi and Miroyama factions will decide how to respond formally to Kishida’s action after the Political Reform Headquarters of LDP issues its interim report later this month. The structure of the Kishida administration, supported by Aso and Motegi factions, may well collapse, if Kishida does not establish an appropriate rule for the activities of factions. Some in the LDP have discussed making any faction a genuine study group, and ending their roles in the distribution of political funds, support of member campaigns, and recommendation of members for cabinet or party leadership positions. The LDP may be divided between pro- and anti-faction groups if Aso and Motegi insist on retaining theirs. Kishida’s approval rating has declined for several months. Party leaders could replace Kishida, ensuring his failure in the next general election. Kishida has, however, gambled his administration’s survival on the public’s understanding of his party’s arcane factions without explaining the purpose their fundraising.

Seven Samurai: The Next Generation

The Japan political elite is all at sixes and sevens. At least, that's how the press sees it.

On June 17, Sankei Shimbun ran a brief but tantalizing article describing a new group of seven up-and-comers within the DPJ. “As the next generation after Seiji Maehara and the rest of the so-called "Seven Magistrates," wrote Sankei, “these seven are known within the party as the Seven Samurai.” 

The focus of the article was the fact that the group had met in a Japanese restaurant in Tokyo that evening to recognize the services of the retiring Yoshimitsu Takashima, Secretary General of the House of Councilors DPJ caucus. Sankei listed the group's members as:

Shinji Tarutoko, DPJ Parliamentary Affairs Chief
Takeaki Matsumoto, Lower House Committee on Rules and Administration Chairman
Goshi Hosono, DPJ Acting Secretary General
Wakio Mitsui, Diet Affairs Committee Deputy Chairman
Takeshi Hidaka, Ichiro Ozawa's former secretary
Yutaka Banno, HR Diet member from Aichi
Koji Matsui, Deputy Chief Cabinet Secretary

Although the Sankei article gave no more information about the group, the presence of Ozawa's former secretary is the most obvious indication that these Seven Samurai represent not just a different generation, but a different faction within the DPJ than the anti-Ozawa “Seven Magistrates.”

Sankei is not the only publication to take note of the Seven Samurai. The July edition of Bungei Shunju features a lengthy article by Taro Akasaka, written just before Hatoyama's resignation, describing the group's formation and its clash with the Six Magistrates in the waning days of the Hatoyama Administration. That's Six Magistrates, not seven, according to Akasaka, because Shinji Tarutoko withdrew from that group, began cooperating with Ozawa, and ended up as one of the Seven Samurai instead.

Akasaka relates how the retiring Takashima – whom he numbers as one of the Seven Samurai in place of Mitsui – somewhat drunkenly coined the group's name back on May 6 as the group met in Korakutei, another upscale Tokyo restaurant, at a time when the DPJ's prospects for the summer elections were looking grim. The group was already ostensibly honoring Takashima's retirement.

“It’s the Seven Samurai, isn’t it.”

The somewhat drunk Takashima spoke with a dizzy expression.

“Do you want to hear my last request at this time of troubles before the House of Councilors election? What would you do if there were a party leadership contest before the election?”

Akasaka goes on to relate that in the discussion that ensued, the pro-Ozawa group agreed that even if Hatoyama stepped down, they wanted Ozawa to continue to hold power within the DPJ, ideally by replacing him as party leader and Prime Minister. However, given Ozawa's unpopularity with the public, he was far from a sure bet to win a party leadership contest. Instead, “the group decided to try to support Hatoyama and Ozawa [avoiding any resignations], and if that didn’t work, to throw their support behind a puppet who would allow Ozawa to continue to wield real power within the party” as Secretary General.

This stands in sharp contrast to the goals of the Six Magistrates, who very much wanted to see a dual resignation from Hatoyama and Ozawa. Akasaka points out that the Magistrates had never been Hatoyama loyalists, having instead supported one of their own members – Katsuya Okada – in the party leader's contest last September. He writes that throughout May, things seemed to be going well for the Samurai, but that the Magistrates saw their opening when Ozawa and Hatoyama finally split over the SDP and Futenma: in a secret meeting between the two on May 27, Ozawa said he wanted to keep the SDP in the ruling coalition for the Upper House elections, but Hatoyama still fired SDP leader Fukushima the next day when she refused, as a cabinet member, to sign the cabinet decision on transferring the Futenma to Henoko, and the stage was set for the SDP to break away and the two leaders to resign days later.

Although Akasaka's piece was written just before the climax of the post-Hatoyama leadership struggle he depicts, his predictions were dead on. When Hatoyama and Ozawa resigned, the Magistrates were able to rally the bulk of the party around their candidate – Deputy Prime Minister Naoto Kan – while the Seven Samurai united as many of the pro-Ozawa troops as they could behind one of their own – Shinji Tarutoko – who was happy to put himself forward as an Ozawa proxy. The only thing Akasaka failed to forsee was the remarkable extent of the Magistrates' victory, and the degree to which that victory would turn around the fortunes of the DPJ.

As befits an intraparty struggle, now that it's over, the party has publicly coalesced around the winner. However, as Sankei's article demonstrates, the Seven Samurai are still meeting together, despite their loss and their patron's ostentatious political “exile.” Moving forward, any observer wanting to know how Ozawa's political influence is fairing under Prime Minister Kan could do worse than to keep an eye on his seven loyal samurai.

Conrad Chaffee works as a Japan Media Analyst for a defense contractor in Northern Virginia and was an APP research assistant