The general-account total in the FY2027 budget requests exceeds ¥143.6656 trillion, with the figure expanding following the creation of a no-cap investment allocation. Social security spending and debt-servicing costs have grown substantially, and although investment for growth is prominent, concerns about fiscal discipline have also been raised.
The general-account total in the FY2027 budget requests under the Sanae Takaichi administration reached ¥143.6656 trillion, approximately ¥20 trillion above the previous fiscal year and a new record high. The figure was pushed higher by incorporating a large supplementary budget into the main budget and by the newly established investment allocation, which has no ceiling. Social security spending rose by ¥339.7 billion from the previous fiscal year to ¥33.6872 trillion as the population aged, while debt-servicing costs grew to ¥36.6386 trillion, also reflecting higher interest payments.
As part of the requirements for the investment allocation, requests for the “Strong and Prosperous Japan” investment allocation for strategic investment reached ¥12.173 trillion, accounting for nearly 10% of the general account. In particular, the Ministry of Economy, Trade and Industry budgeted ¥4.525 trillion to strengthen the foundations for AI and semiconductors, while the Ministry of Education, Culture, Sports, Science and Technology allocated ¥2.183 trillion for a substantial increase in Grants-in-Aid for Scientific Research. The newly established investment allocation has no ceiling, and the Ministry of Finance indicated that it intends to emphasize evaluating effectiveness and inducing private-sector investment.