Japanese road development has been supported financially by two major funding methods since World War II: "earmarked" road taxation and the toll road system. Almost fifty years after the full-scale road construction had begun, Japanese road conditions, once considered very poor, have improved dramatically. Supported by this vigorous road construction, Japan recoveredfrom the war and experienced significant economic development. However, under the long-lasting recession, the government and the majority parties tried to introduce private sector know-how into expressway development, thedomain that had previously been regarded as public. In the midst of debate on the necessity for reform, the maintenance, among other items managed under the toll road system was reduced and, in October 2005, six new companies were privatized. At the same time, a new system for highway maintenance and management established an independent administrative institution that would hold and lend expressway assets and ensure the early debt repayment. Hereafter, the private companies should realize steady development andmanagement of expressways by pursuing efficiency and ensuring the debt repayment within 45 years by the institution, while maintaining their independence. At the same time, the companies must build public understanding and trust by providing a variety of services such as flexible fee levels through electronic toll collection. In addition, earmarked budget, another basis of Japanese road development, is about to be reformed. The government and the majority parties have agreed that they would discuss allocating these tax revenues from earmarked account to the general account while maintaining provisional tax rates. A concrete plan to implement this shift is currently under discussion. The road administration authority considers that the earmarked funding system is based upon the beneficiary burden principle that those who benefit and bear burdens should coincide. Such a systemis appropriate when considering fairness, efficiency, stability, and rationality in road development. To promote necessary road development, it is very important to establish stable financial resources while maintaining the current road stocks properly. Future funding system should be approved by the public and serious consideration of public needs in road development is considered crucial. For the covering abstract see ITRD E139491.
Abstract