27 Apr 2011

Emergency budget announced in Japan

7:16 am on 27 April 2011

The Japanese government has announced an emergency budget worth 4 trillion yen ($US48.9 billion) for disaster relief, after the earthquake and tsunami on 11 March.

The budget, which still needs approval from parliament later this month, could be implemented in May.

It will be financed by taking 2.5 trillion yen from pension funds, as well as from money set aside to raise payments to families with children. Money from emergency reserves is also being used.

To avoid adding to Japan's huge public debt, no new bonds were issued to fund the spending.

Prime Minister Naoto Kan has said this could be the first of several extra budgets needed to fund reconstruction.

Japan already has a debt burden double the size of the economy, and the government estimates it will cost as much as 25 trillion yen to rebuild the country.