Political Reform Loses Momentum

The momentum for reform of political funds is significantly lost in current session of the Diet. While opposition parties submitted a bill for restricting political donation from companies or organizations to parties, the leading coalition by the Liberal Democratic Party (LDP) and Japan Innovation Party (JIP) does not show willingness to implement more transparent politics. A scandal over inappropriate donation to Takaichi does not make a major difference in Diet discussion. 

The slush fund scandal in factions of LDP ignited discussion for making party politics more transparent. The opposition parties demanded complete prohibition of donation from private companies or organizations such as labor union to political parties. The LDP has been highly reluctant to abolish them, arguing that the abolition may obstruct people’s participation to politics.

 

The Centrist Reform Alliance (CRA) and Democratic Party for the People (DPP) cosponsored a bill to restrict donations from companies and organizations in March. The bill proposes limiting the parties to accept those donations to one branch in each prefecture all over Japan. This bill will reduce the local offices of LDP, which can accept those donations, from 7,000 to less than 50.

 

In the last session of the Diet, the Constitutional Democratic Party of Japan (CDPJ) submitted a bill with Japan Communist Party which would prohibit a party to receive any donation from companies and organizations. Komeito cosponsored another bill with the DPP that would reduce offices to receive donations. As CDPJ and Komeito merged in the Lower House in January, the CRA decided to pick the bill by Komeito and the DPP to promote further transparency in political donations.

 

The LDP and JIP showed no interest in the bill. When they formed the leading coalition in October 2025, both parties have agreed on postponing conclusion on this issue until fall 2027. The momentum of JIP for political reform was significantly slowed down by forming the leading coalition with the LDP. The LDP has been focusing on transparency of donations, rather than prohibition, but it represented LDP’s reluctancy to a reform that may erode its financial resource.

 

As the LDP delays concluding the reform in political donations, it was reported that a religious corporation donated 30 million yen to an LDP branch in Nara prefecture in 2024, which representative is Prime Minister Sanae Takaichi. WhileMainichi Shimbun made a research on the corporation to know whether it had been qualified for that amount of the donation, the corporation rejected to disclose information about it.

 

This episode indicates Takaichi’s negative attitude on transparency for her political funds. After achieving a sweeping victory in the Lower House election in February, Takaichi and the LDP looks like thinking that they received an endorsement from voters on their management of political funds, which faced harsh criticisms only a few years ago. It is likely that the LDP will not seriously take this issue until the party will be trapped in next major scandal.

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