Road budget scandal could knock Takaichi’s ambitious agenda off course

As parliament begins its autumn session, Prime Minister Sanae Takaichi finds herself forced to deal with a sudden political scandal involving the agriculture minister, one that could further complicate the government’s efforts to pass its legislative agenda and raise questions about her judgment and leadership.

Agriculture minister Kazuo Yana, who was appointed to the post last month, is now the center of a controversy following reports he drastically cut the road budgets of municipalities in Tochigi Prefecture whose mayors did not support him in February’s Lower House election.

According to an audio recording from May revealed last Wednesday, Yana told a May meeting of his local Liberal Democratic Party branch office that the reductions were made after the mayors of Nakagawa and Nasukarasuyama failed to support him in the February election. It was confirmed Tuesday afternoon by the transport ministry that their road budgets were cut to about half compared with the fiscal year 2025.

Yana, a six-term Lower House member, lost his Tochigi seat in that election but returned as a proportional representative of North Kanto.

On Friday, asked about the audio recording of his statements, Yana said he hadn’t heard it and that he didn’t remember making such remarks, but added if they had been recorded, then that’s probably what he said.

Opposition leaders have said there would be questions in parliament for Yana and the Takaichi administration. Some within the LDP were also reportedly concerned about the way Yana handled the situation.

On Monday, he issued a statement of apology, but said he didn’t formally seek the cuts.

“I wish to retract my statements — and offer my apologies — regarding claims that I had previously slashed road budgets. There is no truth to the allegation that I lobbied the relevant ministries to cut budgets,” Yana said.

He also apologized to Takaichi and said that the prime minister asked him to remain in his post, which he assumed Sept. 17. But there is no sign the controversy will quickly fade away.

Political commentator Takuya Nishimura says that, regardless of Yana’s ultimate fate as minister, Takaichi has some tough choices to make.

“Whether Yana resigns depends completely on Takaichi’s decision and she has two choices. The first is to keep him. But she’ll have to explain why, as Yana’s comments about cutting road budgets of political opponents raises questions about his impartiality as agriculture minister,” Nishimura said.

Takaichi’s second choice, if she hopes to maintain her current approval rate and remove any negative impact of the scandal on her administration, is to replace Yana.

Kicking him out might somewhat appease the opposition parties, as they control the Upper House. The Takaichi administration needs the support of at least one of them to achieve its main priority in the parliamentary session of getting the bill to cut the food consumption tax from 8% to 1% passed — which all the major opposition parties have said they oppose, making it unclear as to how it would be approved.

“But replacing Yana is unlikely to raise the administration’s approval rate. It could also make matters worse for the administration if we see a ‘domino effect’ and other ministers’ scandals come to light,” Nishimura said.

Since becoming prime minister last year, Takaichi has enjoyed high public approval ratings, and no major scandals had so far emerged to call into question her ability to judge who is best suited to serve as a Cabinet minister.

The Yana scandal could change that.

The problematic comments may lead to Yana — and Takaichi — facing questions about another scandal he was involved in. He is one of two sitting cabinet ministers who the suspended from party posts for six months in 2024, having failed to report ¥17.46 million ($110,370) he received in a slush fund scandal centered on members of a defunct LDP faction previously led by the late former Prime Minister Shinzo Abe.

Education minister Yoshihiro Seki is the other minister. He was reprimanded for failing to report ¥8.36 million and could also face critical questions about what happened, possibly creating more headaches for Takaichi.

Before the Yana scandal, Takaichi’s decision-making had been criticized for a top-down approach involving a small group of trusted advisers and ignoring more diverse voices and opposing views before appointments were made.

“She must have thought that the slush fund scandal was over, and does not want to admit her decision to appoint lawmakers involved in the scandal was wrong, even though an Asahi Shimbun poll taken after the Cabinet reshuffle last month showed that 68% of respondents saw the appointment of lawmakers caught up in the slush funds scandal as a problem, and only 30% did not,” Nishimura said.

Parliamentary questioning of Takaichi administration officials, including Yana, begins Wednesday.