2.4 Municipal Merger Law
The 1965 Law for Exceptional Measures on Municipal Mergers provides for exceptional measures to be applied to
associated laws to facilitate the voluntary merger of municipalities. It was granted 10-year extensions in 1975, 1985, and
1995, and its current expiration date is March 31, 2005.
Required amendments were made in 1999 based on the Decentralisation Promotion Plan. The expiration date remains
the same.
The Municipal Merger Law has a provision for declaring the intent to promote voluntary municipal mergers. Unlike the
so-called “merger rush of the Showa era” in the 1950s, when the nation or prefectures took the lead and promoted mergers
(municipalities reduced their numbers by about two-thirds, from 9,868 in 1953 when the Municipal Merger Promotion Law
was enacted, to 3,975 in 1956 when the law expired), this provision intends to create a favourable environment for
promoting municipal mergers with respect for municipal initiatives as a premise. In line with the provision, a wide range of
extraordinary measures were systemised for the benefit of merged municipalities.
To ensure that merged municipalities would not be disadvantaged by mergers, fiscal measures such as the extension of
the grace period before recalculation of the ordinary local allocation tax for merged municipalities, and development loans
for extraordinarily depopulated areas are stipulated. There are also provisions on special consideration for issuing local
government bonds to finance costs of city planning after merger.
Other measures to facilitate municipal mergers include special treatment of the term and number of local assembly
members, the electoral districts of prefectural assembly members, and the requirements to become a city.
Moreover, a residents’ initiative system was created. With the signatures of at least 1/50th of the local electorate,
residents can demand the organisation of a merger conference, allowing them direct participation in the merger process. The
merger conference is a conference based on the Local Autonomy Law and organised by municipalities intending to merge.
It is a forum for discussing conditions for merger including the propriety of the merger itself. It was held in every merger
case conducted under the Municipal Merger Law.
As of June 24, 2002, a total of 136 residents’ initiatives have been presented in 83 regions. Of these, 16 regions have led
to the establishment of a merger conference. On April 1, 2002, Gushiken Village and Nakazato Village in Okinawa
Prefecture merged to become Kumejima Town, the first merger under this system in the country.
2.5 Efforts at Administrative Reform
To deal with progress in decentralisation, local authorities need to establish simple and efficient administrative systems in
support. In addition, local governments are now under extremely severe financial conditions, with local government debt
now expected to total about 193 trillion yen by the end of fiscal 2002, and the combined central and local government debt
projected to reach about 698 trillion yen (excluding overlapping amounts in the Special Account for Local Allocation Tax).
In this situation, the nation has high expectations for local authorities to undertake the radical fiscal and administrative
reforms that are so urgently needed.
Under such circumstances, based on their general plans for administrative reform, which take into account the opinion
of residents, the individual local authorities have been making wide-ranging efforts such as re-examining their work,
reviewing their organisational structure, rationalising the number of staff and wages, and encouraging the skills
development and enhanced awareness of their staff