1 Integration of Pension, Assistance and Taxation

The Pension Reform 2004 in Japan has fixed the schedule of contribution hike until 2017 and incorporated a mechanism of maintaining the financial sustainability of pension funds to some extent. However, there still remain a lot of problems including unequal burden-sharing, unqualified pensioners, old-age poverty and missing of contribution records. These problems are fundamentally originated in the structure of Japanese pension systems which are divided into several occupational groups. Firstly, this paper addresses the Japanese pension system is "inefficient " in terms of both smoothing income (insurance role) and providing adequate income (redistribution role), although the overall income level of Japanese elderly relative to young workers is better than that of the OECD average. Secondly, the paper reveals this inefficiency derives from fragmentations within pension systems, between pension and public assistance, and between pension and taxation. Finally, the paper argues the urgency of integration of relevant provisions for ensuring old-age income security in the context of rapid change in economic and social circumstances and discusses major issue