Photo/Illutration Sanae Takaichi speaks at her inaugural news conference as prime minister on Oct. 21. (Koichi Ueda)

Newly elected Prime Minister Sanae Takaichi instructed her ministers to compile a package of economic measures to address surging living costs and other immediate challenges.

“We will take robust measures to combat soaring prices,” Takaichi told her inaugural news conference held just prior to her first Cabinet meeting on the evening of Oct. 21.

She pledged to abolish a provisional gasoline tax of about 25 yen per liter “without delay” and indicated plans to raise the income tax threshold.

The new coalition government between her Liberal Democratic Party and Nippon Ishin (Japan Innovation Party) will draw up a supplementary budget to fund the economic package and seek its passage during the extraordinary Diet session that runs until mid-December.

The size of the budget will be a key focus with Takaichi advocating “responsible proactive fiscal policy.”

Takaichi, Japan’s first female prime minister, leads a minority government as the LDP and Nippon Ishin lack a majority in both chambers of the Diet.

At the news conference, Takaichi ruled out calling for a snap Lower House election.

“Allow us to focus on economic measures above anything else,” she said. “This is not the time to be talking about dissolving the Diet.”

Takaichi said the LDP and Nippon Ishin will work “hand in hand” on key policies included in their coalition agreement, citing the cost-of-living measures, a backup system for the capital’s functions, social security reform and constitutional revision.

The LDP promised to provide a 20,000-yen ($130) cash handout as a measure against rising prices during the Upper House election campaign in July.

Takaichi said she will cancel the plan, saying, “It failed to gain public understanding.”

She said the funds envisaged for the program would be redirected to hospitals and nursing care facilities struggling with deficits by providing subsidies ahead of schedule to support management and improve working conditions.

Takaichi characterized her Cabinet as one of “decision and progress,” saying, “We will move every single policy forward, be it one step or two.”

At the same time, she acknowledged the challenges of governing as a minority coalition, saying her Cabinet is embarking on “a harsh and difficult voyage.”

Takaichi signaled her intention to seek cooperation beyond Nippon Ishin, although she did not name specific parties.

“We will strive to form a majority and stabilize politics for the sake of the nation and its people,” she said. “We will continue to call for cooperation from all opposition parties that share this aspiration.”

Takaichi emphasized that the government will engage in constructive discussions with a view to accepting, in principle, policy proposals from the opposition, if there are no contradictions with its basic policies.

“We are prepared to demonstrate maximum flexibility,” she said.

Speaking about the creation of a Disaster Management Agency, a project advanced by her predecessor, Shigeru Ishiba, Takaichi said preparations will continue toward establishing it within fiscal 2026.

“It would serve as a command center for thorough pre-disaster preparations, as well as for comprehensive disaster response from the onset through recovery and reconstruction,” she said.

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