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Japan's parliament on Wednesday enacted an extra budget of 3.32 trillion yen (28.2 billion U.S. dollars) for fiscal 2015 through March to underpin the economy and enhance welfare provisions.
The supplementary budget was approved by the upper house of parliament in which Prime Minister Shinzo Abe's ruling Liberal Democratic Party (LDP) and Komeito party ally hold power.
Japan's lower house approved the extra budget in January, with many of the policies drafted to realize Abe's own economic-based goals, that also include supporting Japan's sensitive agricultural sector following the Trans-Pacific Partnership free trade agreement reached last year, which groups Japan and 11 other nations.
Japanese farmers will be supported by an allocation of 340.3 billion yen from the extra budget, to counteract potential losses associated with the upcoming deregulation of the sensitive industry.
The allocations are "intended to help the agricultural industry transform into a competitive sector in order to directly link the effects of the TPP to revitalize the economy and regional areas," Abe said during an upper house budget committee session held a day earlier.
The budget includes an allocation of 1.16 trillion yen for spending on social welfare provisions, which will cover the costs of introducing enhanced mechanisms to encourage more couples to have children and support rearing costs, while encouraging mothers to return to work.
In addition, provisions will be made to persuade staff to continue working in nursing care-related jobs, an essential sector that will further have to deal with the care of Japan's rapidly aging society.
The budget has also earmarked lump-sum payments of around 30, 000 yen to be issued to 11 million low-income senior citizens, ahead of the summer upper house election.
Despite objections from the main opposition Democratic Party of Japan (DPJ) to the one off payments to the elderly during earlier deliberations -- with claims being made that the payments were a means for the LDP-led bloc to curry more favor ahead of the key upper house polls -- Abe has maintained increasing income for the elderly will contribute to consumer spending.
In Japan, consumer spending accounts for more than 60 percent of the gross domestic product.
Finances from the budget have also being earmarked for counter terrorism measures, following the government's launch recently of its own multi-faceted, intergovernmental counter terrorism unit, as Japan will be hosting a number of high profile international events over the next five years, including the G7 summit next year and the Olympic Games in 2020.
The extra budget has also designated around 500 billion yen for disaster and relief measures, while 800 billion yen will go to efforts to accelerate sluggish reconstruction efforts still continuing almost five years after a massive earthquake-triggered tsunami pummeled Japan's eastern seaboard and triggered the world' s worst-ever commercial nuclear disaster.
The government said it will not issue any debt to finance the budget and is relying on tax from the fiscal year following solid earnings from corporations and leftover funds from the previous budget.
The supplementary budget, although 3.50 trillion yen has been allocated to fund policy measures, will total 3.32 trillion yen, as interest payments will likely to be lower than previously anticipated, due to lower interest rates that decreases debt-servicing costs.
The government plans to significantly reducing the primary balance deficit, which refers to the amount by which the government's total expenditure exceeds its total revenue, excluding interest payments on its debt, as Japan's public debt continues to swell and currently stands at the highest in the industrialized world, at more than double the size of its economy.
The DPJ, however, has remained adamant that the extra budget will mainly benefit seniors who already have sizable incomes and savings, while not making enough provisions for younger low-income earners.
