Explainer: Japan PM Shinzo Abe under fire for tampered records in land deal scandal, East Asia News & Top Stories

TOKYO – A dubious land deal scandal that first erupted in February last year has returned to haunt the Japanese Prime Minister, Shinzo Abe, following revelations that documents with regard to the deal were doctored by the Finance Ministry before they were submitted for the public record.

Embattled Finance Minister Taro Aso is resisting calls for him to resign, while Osaka prosecutors look into criminal wrongdoing behind the cut-price deal.

National Tax Agency chief Nobuhisa Sagawa abruptly quit last Friday (March 9), the same day reports emerged that an official who was working on the case at the Osaka-based Kinki Financial Bureau had commited suicide.

Mr Abe has said he would quit as prime minister if either he or his wife, Akie, were found to have directly intervened in the sweetheart deal for ultra right-wing nationalist educator, Moritomo Gakuen.

1. What were the documents about?

Under intense questioning by the opposition in the Diet or parliament last year, Mr Sagawa, the then director-general of the Finance Ministry’s Financial Bureau, said that all documents on the Moritomo Gakuen land sale were “discarded”.

The claim triggered an initial firestorm over document management, given that there was nothing to back up Mr Sagawa’s statements in connection with the scandal.

Later on, the Finance Ministry said they “found” some documents, which they then released.

But these documents had, in fact, been doctored, the Asahi Shimbun reported in a scoop earlier this month.

In total, 14 documents to do with the negotiations leading up to the sale had been altered. The records totaled 78 pages in all, of which 62 had portions that were scrubbed, the Asahi said.

Among the omissions were:

– Descriptions of the circumstances behind the deal as being “exceptional” or “special”, as well as suggestions that the deal was a “political matter”;

– All references to Mr and Mrs Abe, ruling Liberal Democratic Party (LDP) lawmakers and the LDP-linked ultra right-wing pressure group, Nippon Kaigi;

– Comments made by former Moritomo director Yasunori Kagoike about Mrs Abe. These included facts in the public domain, such as her delivery of a speech at a Moritomo kindergarten. He also cited her as having given the go-ahead for the current deal after a tour of the premises. According to him, she said: “It’s good land. Please proceed.”

2. Why were the documents altered?

The documents were tampered with so that they were consistent with Mr Sagawa’s testimony in parliament, Mr Aso told reporters on Monday (March 12).

In resisting calls to step down, Mr Aso insisted that he would be the best man to get to the bottom of the lapse, adding that responsibility for it rested entirely with Mr Sagawa and a “few Finance Ministry officials”.

Public broadcaster NHK reported on Tuesday (March 13) that the changes were made between February and April last year after the Finance Bureau sent an e-mail that appears to have ordered the alterations. The Abe administration was taking heat from the scandal during the period.

The Yomiuri Shimbun also reported on Tuesday that the Finance Ministry official who killed himself had left behind a note, saying that he was guilt-ridden for having been forced into making the changes.

3. What is Moritomo Gakuen?

The Moritomo Gakuen is best known for the controversial move of making its pupils – some as young as three years old – bow to portraits of the Emperor.

At morning assembly, pupils were also made to recite the militaristic Meiji Imperial Rescript of 1890 that calls on Japanese to “offer themselves courageously to the State should emergency arise”. The edict, which indoctrinated millions of Japanese into war, was officially abolished in 1948.

The children were also made to chant nationalistic slogans at a 2015 sports meet, in praise of Mr Abe for revising laws to expand the Self-Defence Force’s role.

Kagoike – who is facing unrelated fraud charges – has publicly boasted of his close ties with the Abes, who have kept their distance ever since the scandal erupted.

4. What is the land deal about?

The deal involved a 8,770 sq m plot of public land in Osaka, which was sold for only 134 million yen (S$1.64 million) despite being appraised at 956 million yen.

When the scandal first erupted, the government said that the discount was due to the fact that there was a need to clean up the heavily polluted land.

The national audit watchdog found late last year, however, that there was “no basis” for the land to be sold only at one-seventh of its valuation.

Moritomo Gakuen had bought the land to build a new elementary school, which it wanted to name after Mr Abe. Mrs Abe was to be the school’s “honorary principal”.

“An excellent elementary school will be established,” she said at the time, reported the Asahi Shimbun. “I hope that I can help with the enthusiastic thoughts of director Kagoike and vice directors toward education.”

Calls for Mrs Abe to testify in the Diet last year were brushed away by the LDP on account that she was a “private citizen”.

5. What is the potential fallout?

This is not the first document-related scandal to hit Mr Abe in recent months.

Last July, Ms Tomomi Inada, a one-time protege of Mr Abe, quit as Defence Minister to take responsibility for the cover-up of controversial mission logs maintained by Ground Self-Defence Force (GSDF) troops deployed to conflict-stricken South Sudan. Her resignation – and a subsequent Cabinet reshuffle – led to an uptick in Mr Abe’s approval ratings and he went on to win handily at a snap election last October.

Mr Abe has, for now, expressed confidence in Mr Aso, a loyal right-hand man since he took office in December 2012. Mr Aso, who doubles up as Deputy Prime Minister, is reported to be preparing to skip the Group of 20 (G-20) Finance Ministers’ meeting in Buenos Aires next week to deal with the unfurling scandal.

Much is at stake for Mr Abe with an upcoming internal party vote for LDP president due in September. The saga could well dent his bid for an unprecedented third consecutive three-year term as leader. Winning the poll will put him on course towards becoming Japan’s longest-serving prime minister.

Also at stake is Mr Abe’s long-cherished goal to revise the Constitution. The LDP wants to reveal its proposals for constitutional revision at a party congress on March 25, but the ensuing intra-party factional chaos and a distrusting public might jeopardise this process.

An opposition that is baying for blood has, meanwhile, been boycotting Diet sittings. This could complicate the government’s passage of the budget for the next fiscal year, among other policy matters.

Amid it all, public support for the Abe administration has been slipping. The NHK showed approval at 44 per cent – down two percentage points from last month.

The right-leaning Sankei and Yomiuri both reported a six-point drop in support ratings from a month ago, with Sankei’s poll pegging approval at 45 per cent and Yomiuri’s at 48 per cent.

In the Yomiuri’s case, it was the first time support has dropped below 50 per cent since Mr Abe’s resounding win in the snap election last October.

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