On Friday Japan enacted legislation making preschool education free as part of Prime Minister Shinzo Abe’s drive to expand child care support and stem the country’s falling birth-rate.
The government will use revenue from the planned consumption tax hike in October to run the free education program that is expected to cost 776 billion yen per year.
The bill, which secured lower house approval in April, was passed by the House of Councillors on Friday, during criticism from some opposition lawmakers that the government should first focus on reducing the number of children on waiting lists for nursery school places before making preschool education free.
Under the program, the government will make preschool education free for all children aged between 3 and 5. Day-care services will also be made free for children up to 2 from low-income households.
If parents send their children to preschools that are not authorized by local governments, maximum monthly subsidies of 37,000 yen per child will be given for those aged between 3 and 5, and 42,000 yen for those aged 2 and younger. School meals will not be covered.
Abe told a parliamentary session on Thursday, “The financial burden of education and child-rearing weighs heavily on young people, becoming a bottleneck for them to give birth and raise children. That is why we are making (education) free.”
Abe’s administration has been encouraging women’s participation in the workforce during a deepening labor crunch, while trying to reduce the number of children on waiting lists for day-care facilities.
According to government data, Japan’s total fertility rate — the average number of children a woman will bear in her lifetime — stood at 1.43 in 2017.
Abe changed how the revenue from October’s planned consumption tax hike from 8 percent to 10 percent will be used, prioritizing child-care support over improving the countries tattered finances.
While ongoing U.S.-China trade tensions have raised uncertainty about the outlook for the export-driven Japanese economy, Abe is expected to go ahead with the tax hike, barring a shock on the scale of the financial crisis triggered by the 2008 collapse of U.S. investment bank Lehman Brothers Holdings Inc.
The Diet also passed a bill to cut the financial burden of higher education on students from low-income families, who are exempted from residence tax payments.
Under a scheme to be launched in April 2020, entrance and tuition fees will be waived or reduced at public and private universities.
At national and public universities, for instance, standard entrance and tuition fees — about 280,000 yen and 540,000 yen respectively — will be waived for such students.
In addition, students from tax-exempt families will receive grant scholarships that can be used to buy textbooks, pay for transportation or cover living expenses.
In a government model case, if students come from a family of four with an annual household income of less than 2.7 million yen, they can take advantage of all the scheme’s benefits.