TOKYO, Sep. 27, 2009 (Kyodo News International) -- A series of fee hikes scheduled in October are expected to strain family budgets in Japan, threatening to dampen consumer spending for a prolonged period of time when many Japanese are taking pay cuts or are without jobs.
Cost increases coming in the form of fuel surcharges for air travel and higher health insurance contributions and utility rates, for example, are certain to become a challenge for the government of new Prime Minister Yukio Hatoyama as it endeavors to lift the economy out of the recession.
Japan Airlines and All Nippon Airways are putting back in place jet fuel surcharges on international flights in October to reflect higher oil prices. An additional fee of 7,000 yen will be slapped on one-way flights between Japan and North America, and between Japan and Europe.
The premium rate under company health insurance plans, shared evenly between employers and employees, will rise to 15.704 percent from the current 15.35 percent.
Electricity and gas rates, which have been on the downward trend recently, will be increased by Hokkaido Electric Power Co., Tokyo Electric Power Co. (OOTC:TKECY) and Okinawa Electric Power Co. in October. The planned hikes will result in a monthly cost increase of 9 yen to 34 yen for a family of four.
Other power and gas companies will likely follow suit in November, industry watchers say.
Consumers on the other hand will become eligible for more generous benefits in other areas from October.
The childbirth subsidy is set to increase 40,000 yen to 420,000 yen. Most prefectural governments are raising minimum wages. A new program is due to be launched in order to provide housing benefits for a maximum of six months to those who have lost jobs and homes within the past two years.
New legislation aimed at reining in excessive competition in the taxi business is expected to deliver some relief to taxi drivers whose income has been badly hit as a result of deregulation.
Beginning also in October, people on welfare can submit applications for free tuners, which will be distributed so they can continue to use their old analog TV sets after all TV broadcasting goes digital in 2011.
