TOKYO: Japan will cut discretionary spending such as public works by 10 percent in next fiscal year's budget, a draft document showed, as Prime Minister Shinzo Abe's government seeks to cut the government's enormous deficit even as it promotes growth.
The savings of just under 4 trillion ($39 billion), detailed in the document seen by Reuters on Wednesday, are equivalent to the amount that the government wants to add for Abe's "growth strategy", economic reforms intended to raise Japan's long-term potential growth rate.
The document, a draft of the Finance Ministry's guidelines for budget requests for the fiscal year starting next April, is expected to be approved by Abe's Cabinet on Friday, said a person familiar with the process.
The budget will also limit the increase in social welfare spending, the biggest budget item, to 830 billion yen, below this fiscal year's 1.3 trillion yen increase.
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