## Promotion of Administrative Reform

## (1) Intensive Reform Plans

In order to thoroughly promote local administrative reform, the Ministry of Internal Affairs and Communications has compiled “New Guidelines for the Promotion of Administrative Reform in Local Governments” (New Local Administrative Reform Guidelines) and notified local governments of these on March 29, 2005.

As a result, local governments have compiled and disclosed intensive reform plans indicating specific efforts, such as the reorganization and arrangement of administrative work and projects and the promotion of private-sector consignment, to be undertaken in general until fiscal 2009.

With respect to the disclosure status of intensive reform plans as of December 1, 2008, 47 prefectures (all prefectures), 17 government ordinance-designated cities (all government ordinance-designated cities), and 1,788 municipalities (all municipalities excluding government ordinance-designated cities) have disclosed their respective plans. This means that all local governments have completed the formulation and disclosure of intensive reform plans during fiscal year 2008.

## (2) Further Promotion of Administrative Reform

On August 31, 2006, the Ministry of Internal Affairs and Communications formulated its “Guidelines for the Further Promotion of Administrative Reform in Local Governments” and requested local governments to make positive efforts toward three reforms: the reform of total personnel expenses, reform of public services, and reform of local public accounting. As of April 1, 2008, 33 prefectures, 14 government ordinance-designated cities, and 1,133 municipalities have already reviewed their status in these respects.

## Reform of total personnel expenses

A further net reduction in the number of employees has been achieved bearing in mind the net reduction (down 5.7%) in the number of national public employees

Promotion of salary reforms (as a reflection of regional private-sector salaries, further streamlining of salaries)

Efforts to curb personnel expenditures by third-sector enterprises, etc.

## Reform of public services

● Implementation of studies in the light of project classifications and overall inspection of the need for public services and implementing entities

Setting of performance indexes related to the maintenance and improvement of public services and numerical targets related to expenditure reductions, etc., in the implementation of marketization tests

## Reform of local public accounting (local asset and debt management reform)

Promotion of the compilation of four documents: balance sheets, administrative cost statements, financial balance statements, and net asset fluctuation statements

Formulation of the direction and specific measures for asset and debt reforms including promotion of the sale of unused assets, the effective utilization of assets, etc.

## Formulation of Rules for Information Disclosure to Facilitate Comparisons and Appraisal Between Local Governments and the Strengthening of Resident Monitoring

● Enhancement of disclosure systems, including salary information

● Further promotion of financial information disclosure to enable comparisons between organizations

Disclosure of the implementation process and implementation of the results of marketization tests

Active appointment of outside personnel as auditors and the utilization of external auditing