Thanks for nothing

One of the Aso administration’s economic initiatives that was retained by the Democratic Party of Japan when it took over the government last year was an allowance for people who had lost their housing as a direct result of having lost their jobs, because, in most cases, the place they were living in was either owned or subsidized by their employers. The DPJ plan originally earmarked ¥70 billion for this allowance, with an additional ¥30 billion for it in the new supplemental budget.

Applications for the allowance started last October. A successful applicant would receive rent subsidies for six to nine months. The amount of the subsidy depends on the region and other factors. For Tokyo residents, it came to ¥69,000 a month for a “family” and ¥53,700 a month for a single person. The subsidies would be handled by the welfare ministry and local governments.

The ¥70 billion that has been set aside in the budget for the program is meant to cover 320,000 people. However, during the first three months only 11,518 people applied and about 7,900 have so far qualified for it. Local governments blame poor communications for the low demand, but there’s another, more significant reason why people aren’t flooding welfare offices to apply: they know it won’t make a difference.

First of all, unless the applicants are still living in the residences they lived in when they were working–which is unlikely and, in any case, doing so would probably disqualify them since the whole point of the subsidy is for people who’ve been kicked out–they will have to find new housing. And unless that new housing is public housing–again, unlikely, because there’s usually a waiting list for public housing–they will have to rent from a landlord, and landlords normally demand security deposits and gift money, and realtors take their fee, too. These costs are not covered by the subsidy, only the rent. In addition, few landlords will probably rent to someone whose source of income is guaranteed for, at longest, nine months. It’s assumed that the person will find a job by then, but what if he doesn’t?

As with many of the government measures enacted to help people cope with the recession, this one is merely a stopgap, and isn’t very realistic. In order to actually make a difference, the government needs to revise the whole welfare system so that a safety net is always in place.

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