Guest blog: Japan’s regions – could the Tohoku Earthquake lead to local government reform? by Joel Rheuben

[Joel Rheuben, LLB / BA (Hons) Syd, is pursuing postgraduate studies at the University of Tokyo Faculty of Law. We extend our condolences to the victims of the natural disasters and ongoing nuclear power plant emergency in Tohoku.]
On 30 April, the Democratic Party of Japan’s “Reconstruction Vision Team” delivered its preliminary report to Chief Cabinet Secretary Yukio Edano. Its report set out in general terms a range of potential mid- to long-term measures to reinvigorate the local economy and improve food and energy security in Japan’s Tohoku region in the wake of the 3/11 earthquake. Significantly, in addition to proposing options such as the establishment of a special corporate tax-free economic zone, the report urged the reconsideration of the relationship between the national and local governments more generally, including “keeping in sight a future State” for the region.

The merger of Japan’s 47 prefectures into a dozen or so larger, semi-autonomous “states” has been proposed since the immediate post-War era, but has only gathered steam since the 1990s, as decentralisation reforms have largely bypassed the prefectures, instead directly devolving national powers to municipal level governments. Following several recommendations by the Prime Minister’s Research Council on Local Governance during the early 2000s for the creation of a “State System”, or “doshusei”, Prime Minister Shinzo Abe introduced a “State System Special Zones Promotion Law”, establishing a pilot quasi-federal power sharing programme with Hokkaido prefecture, and appointed the Chief Cabinet Secretary as special “State System Minister” to oversee it. A more comprehensive State System Promotion Bill is due to be submitted to the Diet at the end of the pilot programme in 2015.
There is, however, nothing to prevent the creation of states in the meantime: amendments to the Local Autonomy Law in 2004 have made it easier for prefectures to merge, and such merged entities would be eligible to receive a small number of devolved national powers (albeit temporarily) under the Special Zones Promotion Law.
The Tohoku prefectures have long been the most likely candidates for such a merger. Even before the earthquake, Japan’s demographic crisis had been most pronounced in the north of the country, with the gradual depopulation and economic stagnation affecting most towns and cities, and the creation of a “super-prefecture” had been seen as a way to rationalise public service costs and boost competitiveness in attracting external investment. Previous governors of the three northern-most prefectures (Aomori, Iwate and Akita) had committed to a merger by 2010, but this movement lost impetus due to a reluctance by Iwate and Akita to financially support ailing Aomori, and attention instead shifted to the longer-term goal of a six-way merger taking in Miyagi, Fukushima and Yamagata prefectures.
The aftermath of the Tohoku earthquake now seems an obvious catalyst for such a merger, particularly as the government moves to create a special economic recovery zone amongst the east coast prefectures.
A merger at the prefectural level could draw ample precedent from the more than 1000 municipal governments that have merged in the past decade under a Koizumi-era programme, many of them in the Tohoku region. It is likely that there will ultimately be further municipal mergers among those towns and villages with the greatest population losses, or in the area surrounding the Fukushima nuclear plant, where already entire populations are being evacuated for up to the next 30 years.
Similarly, the creation of a single Tohoku state now will depend on those prefectures on the west coast determining that the short-term costs of rebuilding the east coast prefectures will be outweighed by the long-term economies of scale and other benefits of merging. Government expenditure and already-announced stimulus measures such as a moratorium on social security contributions in the east coast prefectures will no doubt assist in this determination.
A merger in Tohoku would inevitably lead to similar mergers elsewhere in the country, most likely in Kyushu, where prefectures have already harmonised a number of local ordinances, and in the Kansai area, where Governor Toru Hashimoto (a supporter of a state system) is simultaneously pushing on with his proposal to merge the Osaka prefectural and city governments into a single Osaka metropolis. As with all local government reform in Japan, however, any move towards an eventual Tohoku state is likely to be as slow as the recovery effort itself.

Author: Luke Nottage

Prof Luke Nottage (BCA, LLB, PhD VUW, LLM LLD Kyoto) is founding co-director of the Australian Network for Japanese Law (ANJeL), Associate Director (Japan) of the Centre for Asian and Pacific Law at the University of Sydney (CAPLUS), and Professor of Comparative and Transnational Business Law at Sydney Law School. He specialises in international dispute resolution, foreign investment law, contract and consumer (product safety) law.