Personnel Exchange Among Central and Local Governments in Japan

Transcription

1 Personnel Exchange Among Central and Local Governments in Japan Takenori Inoki Abstract This paper describes the Japanese system of staff loans and transfers across different levels of government. It examines various possible rationales for the existence of this system and discusses its implications for the building of capacity among local governments. World Bank Institute

2 Copyright 2001 The International Bank for Reconstruction and Development/The World Bank 1818 H Street, N.W. Washington, D.C , U.S.A. May 2001 The World Bank enjoys copyright under protocol 2 of the Universal Copyright Convention. This material may nonetheless be copied for research, educational, or scholarly purposes only in the member countries of The World Bank. Material in this series is subject to revision. The findings, interpretations, and conclusions expressed in this document are entirely those of the author(s) and should not be attributed in any manner to the World Bank, to its affiliated organizations, or the members of its Board of Executive Directors or the countries they represent. Personnel Exchange Among Central and Local Governments in Japan Takenori Inoki pages. Stock No

3 Contents Foreword v Introduction 1 The Nature of the Data 2 General Trend and Structure of Personnel Loans 3 Discussion 18 Bibliography 22 iii

4

5 Foreword This paper was prepared for a project on Local Government Development in Japan. The project was organized by the World Bank Institute under the auspices of the Program for the Study of Japanese Development Management Experience financed by the Policy and Human Resources Development Trust Fund of the Government of Japan. The principal objectives of this Program are to conduct studies on Japanese and East Asian development management experience and to disseminate the lessons of this experience to developing and transition economies. Typically, the experiences of other countries are also covered in order to ensure that these lessons are placed in the proper context. This comparative method helps identify factors that influence the effectiveness of specific institutional mechanisms, governance structures, and policy reforms in different contexts. A related and equally important objective of the Program is to promote the exchange of ideas among Japanese and non-japanese scholars, technical experts and policy makers. The papers commissioned for this project cover a number of important issues related to local government development in Japan. These issues include: the process of controlled decentralization; increasing political inclusiveness; redistributive impact of local taxes and transfers; allocation of grants; municipal amalgamation; personnel exchanges; personnel policies; agency-delegated functions; and local policy initiatives. Farrukh Iqbal, Program Manager World Bank Institute v

6

7 Personnel Exchange Among Central and Local Governments in Japan Takenori Inoki Osaka University, Japan Introduction The bulk of staff in Japanese central and local government units are career staff in the sense that they come in at entry level jobs and are then gradually selected and promoted from within to jobs featuring greater responsibilities and larger management spans. There are exceptions to this general rule, however. One important exception is the practice of personnel transfers from the central government to local government units and vice versa. Personnel can be loaned or transferred depending on the length and specific conditions of the out-placement. 1 This practice illustrates the interdependence of central and local governments in Japan, a feature that has influenced the manner in which decentralization has proceeded in postwar Japan. Under the Meiji Constitution, governors and leading staff in prefectures were the Emperor s functionaries (officials), and the interior minister had the power to appoint them. One telegram from the Ministry of Interior was enough to send officials of the Interior Ministry back and forth between the central government and prefectures. Prefectural governments were thus essentially local outposts of the central government in prewar Japan. The Ministry of Interior was a gigantic ministry, covering a wide variety of tasks, including local administration, public elections, the police, sanitation, and construction works. The prefectural governor was an official appointed by the Emperor. Because of its power and influence in central government, the Ministry of Interior was the most popular ministry among job-seeking imperial university students, of whom only the cream were admitted to the Ministry s ranks. The post-war Constitution opened a new chapter in central-local relations by guaranteeing local autonomy. It provided for the prefectural governor to be elected by a public vote of the local inhabitants, instead of being appointed by the Interior Ministry, as under the previous Constitution. This is probably the greatest difference between pre- and post-war local governance systems. All the public servants in prefectural governments are also local staff, appointed by the governor in each prefecture. Under this new Constitution, recruitment and promotion are managed on a merit basis by the appropriate local government. I would like to thank Hiroaki Inatsugu, Farrukh Iqbal, Michio Muramatsu, Shun-ichi Furukawa, and the participants of the World Bank workshop on Local Government and Development in Japan, for their helpful comments. Furukawa s detailed comments were particularly useful. I also wish to thank Yukiko Tsuji for research assistance. Comments from Takeo Hoshi, Regine Mathias, Yoko Sano, Yoshio Higuchi, Masako Maeda, Hitoshi Nagano, and the participants of HRM seminar of Keio University were also helpful at an early stage of this research. 1 A loan (shukko or haken) usually means a temporary movement of staff from one organization to another for a limited length of time, while a transfer (tenseki) is a placement of staff, including payroll registration, from one organization to another for an indefinite length of time. These two terms are often used interchangeably, because the duration of these transfers are generally not explicitly specified. Therefore, these two terms are not distinguished in this chapter except when it is necessary. 1

8 2 Takenori Inoki Each prefecture, however, did not immediately gain a stock of knowledge of how to find and train capable leading staff. Publicly elected governors, therefore, were expected to be exleading officials from the central government who could continuously perform administrative jobs in newly established local governments. In a sense, local governments did want to receive, at least in the early postwar years, officials from the Interior Ministry as relief manpower. Later, after the 1960s, local governments gradually began to pursue their own personnel policy of conducting independent recruitment and promotion to develop their core leading staff. This practice of relief, however, carried on. Bureaucrats transferred from the central government, who were originally expected to serve on a temporary basis, gradually began to take different roles in local governments. Indeed, in many cases, such relief positions became hereditary. In these cases, when one staff member returns to the central government after completing his two or three years in office, another staff member from the same ministerial position enters the same office in the prefectural government. Such practices pose questions about the motivations of the central and local governments. What are the incentives which lead them to engage in personnel transfer? For instance, is there any financial reason for such practices? Does a prefectural government that consistently receives staff from the central government enjoy any financial favor from the central government? Does the exchange of personnel stabilize center-local relations by providing a steady flow of information? Does the transfer contribute to increased managerial capacity of the central government? It is possible to shed light on these questions by reference to certain patterns in the data on intergovernmental personnel transfer as well as from anecdotal evidence. The Nature of the Data Since our main interest lies in the motivation underlying personnel exchanges, a natural place to look for relevant data is the career profiles of central government staff, especially the socalled leading career staff who are typically recruited from among college graduates by an extremely competitive career staff examination. There are two sources of information on the career of leading staff in the central government. One is the set of annually published directories of individual ministries that provides information on such career details as accession, promotion and transfers. A second source is interviews with staff currently stationed in local (mainly prefectural) governments. Interviews provide contextual and qualitative information while the career directories are quantitatively rich in information about general trends and structures. In the directories, the career of each staff member is arranged in the following way: name, date of birth, birthplace, and last school attended are listed first, and careers after the date of admission to the ministry are chronologically arranged. The example given below is the case of a Vice-Minister of MoHA (Ministry of Home Affairs), who retired several years ago. Career directories are published annually, except for that of MoHA, which was discontinued in The directories contain data on: the frequency of transfers and the name of the prefectural government; the positions in prefectural governments occupied through these loans; and the periods of loan, which together indicate whether or not the loan is hereditary in nature, and so forth.

9 Personnel Exchange Among Central and Local Governments in Japan 3 Directory Listing: Vice-Minister of MoHA 1958 April entered MoHA 1958 April to Hokkaido, Archives, Tax, Local Finance 1960 Dec. To Shizuoka, Industry and Commerce, Education 1962 Jan. MoHA, Regional Development 1964 Oct. to Tochigi, Director, Regional Section 1966 April to Tochigi, Director, Personnel Division 1967 April to Kyoto, Director, Education Commission 1969 April MoHA, Assistant Director 1969 Nov. MoHA, Assistant Director, Local Finance Division 1974 April MoHA, Deputy Director, Local Finance Division 1974 July to Kitakyûshûshi, Chairman, Education Commission 1976 Nov. MoHA, Assistant Vice-Minister 1978 Jun. Ministry of Construction, Urban Development 1980 July MoHA, Assistant Vice-Minister 1980 July Deputy Mayor, Kitakyûshûshi 1983 July MoHA, Director, Budget Section 1987 Oct. MoHA, Deputy Vice-Minister for Policy Coordination 1989 Jun. MoHA, Deputy Vice-Minister for Administration 1991 Oct. Vice-Minister of MoHA For our research purposes, there are some limitations to these data. The staff currently on loan to any prefectural government are not listed in the directory, but if the loan is of a hereditary nature (which is usually the case), we can observe successive loans to the same office over many years. The staff listed in this directory is limited to executives above the level of assistant director (Kachôhosa). So it does not contain information on lower-level employees. We can, however, obtain the career information of these young officials partly from the career data of the upper-level executives when they were young. General Trend and Structure of Personnel Loans One survey, conducted 20 years ago (Muramatsu 1981), summarizes the frequency of loans to prefectural governments in the past based on interviews of 251 elite bureaucrats in 8 ministries. As can be seen in Table 1, MoHA occupies a rather exceptional position among these eight ministries, showing an extremely high frequency of loans and transfers. While economic- policy-related ministries such as MoF, MITI (Ministry of International Trade and Industry), and the Economic Planning Agency (EPA) record very low numbers of loans in this survey, the three ministries that came into being through the dissolution of the Interior Ministry in December 1947 MoL (Ministry of Labor), MoC (Ministry of Construction), and MoW (Ministry of Welfare) show uniformly high rates of loans to local governments. It

10 4 Takenori Inoki is, in a sense, quite natural that MoHA, which is one of the main successors of the Interior Ministry in central-local governance, should pursue an intensive personnel exchange policy with local governments. Table 1: Frequency of Bureaucrats on Loan to Local Governments Frequency Ministries N EPA MOF MOW MOA MITI MOL MOC MOHA TOTAL Source: Michio Muramatsu, Gyosei Elite Chosa (Survey on Elite Bureaucrats) conducted between December 1976 and February Sample Size 251. Ministry of Home Affairs (MoHA) In prewar Japan, the governors of all prefectures were stationed exclusively through the personnel policy of the Interior Ministry. The governors were Chokuninkan (appointees by the ordinance of the Emperor) and were in office only for a few years. Even after the Interior Ministry had been disbanded, remnants of this system survived with respect to the deputy governor, the highest local post achievable without direct election. Deputy governors of Nara, Tottori, Shiga, Ooita, Gifu, Miyagi, Shizuoka, and Tokushima are regularly sent from MoHA. At the municipal level, similar practices are observed for deputy mayors. Kitakyûshû-shi, Funabashi-shi, Nase-shi, Kawaguchi-shi, Morioka-shi, and Matsue-shi are such cases (see Table 2). One interesting case is that of Kyoto City, where the deputy mayor's office has been occupied alternately by elite bureaucrats from MoC and MoHA. The first case was Mr. Kinoshita, a MoC bureaucrat, who took office at the Urban Planning Division of Kyoto City (Toshikeikaku-Buchô) and was promoted, through the director-general of the Construction Bureau, to deputy mayor in After Mr. Kinoshita, Mr. Satô from MoHA took office in 1992, and Mr. Uchida from MoC succeeded to the same post in 1994, followed by Mr. Kitazato from MoHA. The reason why Mr. Kinoshita took office as the deputy mayor of Kyoto in the first place was not clear from the interview. He did not directly come to the office as deputy mayor, but was "quasi-internally" promoted in the Kyoto City office. It is indeed undeniable that the connection between Kyoto City and MoC has been strong since long-serving mayor Imagawa was first transferred to a director-general post in the Kyoto City office from MoC.

11 Personnel Exchange Among Central and Local Governments in Japan 5 (Incidentally, Mr. Satô, after serving as deputy mayor in Kyoto for two years, returned to MoHA; three years later he was appointed deputy governor of Fukuoka Prefecture.) Table 2: Transfers from MOHA to Deputy Mayors Aomori (1) Kasugai (4) Matsuyama (3) Sakai/Takaishi (1) Chiba (1) Kawaguchi (1) Morioka (1) Sendai (1) Fukuoka (2) Kawasaki (1) Nagano (1) Soka (1) Funabashi (1) Okohamau (8) Naze (1) Takarazuka (1) Itami (1) Kurashiki (2) Okayama (2) Urawa (2) Kaji (1) okoh (2) Omiya (1) Wakayama (4) Kashima (1) Matsue (1) Osaka (2) okohama (1) Note: Number of Deputy Mayors transferred is indicated in the parenthesis MoHA has a number of "hereditary" director-general posts, especially in General Affairs (Sômubuchô) in prefectural governments. The following list shows the pattern of such appointments over the last quarter century or so: Akita ( ) Aomori ( ) ( ) ( ) Ehime ( ) Fukui ( ) Hiroshima ( ) Hokkaido ( ) ( ) Hyogo ( ) Ibaragi ( ) Ishikawa ( ) Kagawa ( ) ( ) Kochi ( ) ( ) Kyoto ( ) ( ) Miyagi ( ) Nara ( ) ( ) ( ) Okayama ( ) Ooita ( ) Shiga ( ) Shizuoka ( ) ( ) ( ) Tochigi ( ) ( ) Tottori ( ) ( ) Toyama ( ) ( ) Yamanashi ( ) ( ) ( )

12 6 Takenori Inoki Table 3 provides data on the number of loans or transfers from various government ministries to local governments. Column MoHA1 denotes the total number of transfers from MoHA while column MoHA2 denotes the total number of transfers to director-general posgts in each prefeecture. As can be seen from this table, the practice of personnel transfer is quite popular, especially for MoHA. At the same time, there is also a large number of staff on loan to the central MoHA office from prefectural governments. These staff were all recruited by the local government and loaned to posts such as deputy director (Rijikan), assistant director (Kachôhosa), or senior specialist (Shidôkan) in the Tokyo MoHA office. This movement virtually forms a counter-stream of loans and transfers in intergovernmental personnel policy. The numbers listed below were obtained from stock data in the 1992 directory, not a sum of the past flows of staff from local governments to MoHA: From Hokkaido 3 From Akita 1 Fukushima 1 Tochigi 3 Saitama 3 Kanagawa 1 Kawasaki 1 Niigata 1 Toyama 2 Ishikawa1 Nagano 1 Gifu 2 Hyogo 2 Hiroshima 1 Tokushima 1 Fukuoka 1 Saga 1 Nagasaki1 Miyazaki 7 Kagoshima 2 Table 3: The Number of Loans or Transfers from Central Ministries to Prefectures MOF MOHA1 MOHA2 MOC MOL MOW MOE 1 Hokkaido Aomori Iwate Miyagi Akita Yamagata Fukushima Ibaragi Tochigi Gunma Saitama Chiba Tokyo Kanagawa Niigata Toyama

13 Personnel Exchange Among Central and Local Governments in Japan 7 MOF MOHA1 MOHA2 MOC MOL MOW MOE 17 Ishikawa Fukui Yamanashi Nagano Gifu Shizuoka Aichi Mie Shiga Kyoto Osaka Hyogo Nara Wakayama Tottori Shimane Okayama Hiroshima Yamaguchi Tokushima Kagawa Ehime Kochi Fukuoka Saga Nagasaki Kumamoto Ooita Miyazaki Kagoshima Okinawa Total # of Loans & Transfers Number of Leading Career Staff Average Frequency

14 8 Takenori Inoki Two Examples of the Careers of MoHA Bureaucrats As we have seen, MoHA bureaucrats occupy a special position among all ministries in their career formation: their mobility between the central and prefectural governments is extremely high. We will outline the careers of two MoHA bureaucrats of different generations below, in order to grasp the specific nature of their mobility. Little change is observed during the time-span of almost two generations, in spite of such a seemingly large institutional change as the disbandment of the Interior Ministry shortly after the war. Mr. A s Career (Earlier Generation). After graduating from the Law Faculty at the University of Tokyo, Mr. A entered the Interior Ministry (IM) in In the same year, such celebrities as Y. Nakasone (later prime minister), D. Utsumi (later the president of the National Personnel Authority), M. Ozawa (later a congressman), and B. Tsuda (later governor of Kanagawa Prefecture) also passed the Kôbun (the examination for the career bureaucrats) and entered the IM. In his first year at the IM, he served as a sort of trainee as section chief of the Economic Control Section in the Economic Department of Ibaragi Prefecture. It was not uncommon to be stationed in local government soon after the accession to IM, since personnel management of career public servants was completely centralized in prewar Japan. It was then a generally accepted practice that economic control of the local economy was in the hands of the IM, whereas economic control in the central government was executed by Shôkoshô (Ministry of Commerce and Industry, origin of the present MITI). From July 1942 to May 1946, he was conscripted and served in the military; he returned to the IM, Bureau of Local Office, in July His first job after his return to the IM was to reorganize local finance and to reform the General Election Act from a small-district system to a medium-district system. The dissolution of the IM was decided in May 1947 and executed on 31 December in the same year. The IM was divided into 12 new ministries and agencies. On this occasion, Mr. A reconsidered his future career plan, including job opportunities outside the central government. He finally moved to the secretariat of the local public finance commission, which is composed of 5 commissioners (including state minister) and approximately 50 staff members. He was appointed as secretary general of this commission. After this career interruption in MoHA, Mr. A returned to the Agency of Home Affairs (then attached to the Prime Minister s Office) in 1953, and finally to the newly organized Ministry of Home Affairs in In an interview, Mr. A commented on the difference between governors in prewar and postwar Japan. The prewar governors usually stayed in office only for one or two years, and they were morally upstanding and relatively free of political corruption. They performed their duties, always paying attention to the activities and the intentions of the central government in Tokyo. The postwar governors, in contrast, primarily focused on the preference of the constituency in the prefecture, because the governors were to be elected after the war. This change, although democratic in nature and supposedly assuring more local autonomy, has

15 Personnel Exchange Among Central and Local Governments in Japan 9 brought with it certain drawbacks. The most serious is that the drive to be reelected time and again tends to adversely affect the political atmosphere in prefectures. In prewar Japan, certain prefectures three major cities (Tokyo, Osaka, and Kyoto) and the five port cities (Kanagawa, Hyogo, Fukuoka, Niigata, and Nagasaki) were thought to offer important positions for dispatch from the IM in the central government. Mie Prefecture occupied a special position as the location of the Ise Shrine (the head Shrine of Japanese Shintoism). The Police Department chief in Ibaragi and Nagano Prefectures played special roles in political security related to rightists and leftists, respectively. Yamaguchi (Kanmon) was also an important prefecture in handling foreign matters related to immigration. Governors and career bureaucrats stationed in these politically important prefectures were implicitly promised bright careers. This personnel transfer from the IM to the prefectures left its basic pattern in the human resource management of MoHA, even after the dissolution of the IM in Mr. B's Career (Later Generation). After graduation from the Law Faculty at the University of Tokyo in 1973, Mr. B entered MoHA directly and began his career in the regional section office in Shiga Prefecture. In 1975 he was transferred as staff of the MoHA College Office and returned to the Local Finance Division in MoHA after three years. Between 1978 and 1980, he studied at Harvard Law School as a dispatched student from the National Personnel Authority. From August 1981, he served as the chief of the local finance section in Ehime Prefecture for two years. Then he went back and forth between MoHA and local governments such as Ishikawa and Kyoto. In Ishikawa, he served as director-general of industry and labor, and then of general affairs. After returning to MoHA, he occupied such positions as senior specialist for local finance and director of the Public Relations Division. In 1994, after serving as director of the Local Finance Coordination, he was transferred as deputy mayor of Kyoto City. Interior-Related Ministries We will next investigate the trend and structures of the three ministries MoC, MoL (Ministry of Labor), and MoW (Ministry of Welfare) that belong to another group of important postwar successors of the Interior Ministry. Here we also find similar flows of human resources from the central to the local governments. The tendency, however, is not as strong as in the case of MoHA. MINISTRY OF CONSTRUCTION (MOC). Loans from MoC are to the post of Kacho (director) in prefectural governments. Directors of general affairs in 10 prefectures, directors of planning in 20 prefectures, and directors of construction in 33 prefectures are loaned staff from MoC (see Table 4) Posts higher than director director-generals are taken by MoC personnel in such prefectures as Mie, Ibaragi, Osaka, Tokushima, Yamanashi, and Nara (see double-circles in Table 4). The large number of loans from MoC is partly the result of its large number of technical officers (Gikan) in MoC. Career bureaucrats in the MoC, as in other ministries, are composed of two categories: Jimukan (secretary officer), mainly graduates in law, and Gikan, graduates

16 10 Takenori Inoki in engineering, primarily civil engineering. Among annual new entrants in MoC, about 15 are Jimkan and more than 60 are Gikan. However, since more than half of the executive positions in the Tokyo head office of MoC are occupied by Jimkan, most of the Gikan find their positions either in MoC s regional office or in prefectural government as loaned officers. This being the case, MoC naturally has a strong incentive to maintain the maximum number of posts in local governments. The inflow of staff from MoC is also observed at the municipal level. Deputy mayors (Nagaoka, Kure, Shimonoseki, Ootsu, Shizuoka, Hiratsuka, Kyoto, Takasaki, and Hamamatsu), director-generals or deputy director-generals of cities such as Tokorozawa, Sendai, Gifu, Kitakyûshû, Takasaki, Kisarazu, Tokushima, Fukuoka, and Tsuchiura are but some examples. In addition to such conventional construction work as flood control, a typical task carried out by MoC in prefectures has been construction and management of public housing. In allocating public housing nationwide, prefectural governments play the role of mediator between the central government and the municipalities, especially with regard to allocation of subsidies from the central government. In this respect, the subsidy is a most important instrument in the control the municipal governments by the central government, and the prefectural governments with career staff from Tokyo used this instrument in competitive situations. Table 4: Directors from MOC to Prefectures 1 Hokkaido 2 Aomori 3 Iwate 4 Miyagi General Affairs Planning Constructions 5 Akita 6 Yamagata 7 Fukushima 8 Ibaragi 9 Tochigi 10 Gunma 11 Saitama Åù Åù

17 Personnel Exchange Among Central and Local Governments in Japan Chiba 13 Tokyo 14 Kanagawa 15 Niigata General Affairs Planning Constructions 16 Toyama 17 Ishikawa 18 Fukui 19 Yamanashi 20 Nagano Åù 21 Gifu 22 Shizuoka 23 Aichi 24 Mie Åù É 25 Shiga 26 Kyoto 27 Osaka 28 Hyogo 29 Nara Åù Åù Åù 30 Wakayama 31 Tottori

18 12 Takenori Inoki 32 Shimane 33 Okayama 34 Hiroshima 35 Yamaguchi 36 Tokushima 37 Kagawa 38 Ehime 39 Kochi 40 Fukuoka 41 Saga 42 Nagasaki 43 Kumamoto 44 Ooita General Affairs Planning Constructions Åù 45 Miyazaki 46 Kagoshima 47 Okinawa É: Directors Åù : Director - Generals

19 Personnel Exchange Among Central and Local Governments in Japan 13 Table 5: Loans from MOL to Prefectures Total Directors of Employment Securities Director Generals etc. Deputy Director- Generals etc. 1 Hokkaido Aomori Iwate 4 Miyagi 3 5 Akita Yamagata Fukushima 8 Ibaragi Tochigi Gunma Saitama 12 Chiba Tokyo 14 Kanagawa Niigata Toyama Ishikawa Fukui Yamanashi Nagano Gifu Shizuoka 23 Aichi Mie Shiga Kyoto Osaka 8 28 Hyogo Nara 30 Wakayama Tottori 4 32 Shimane 33 Okayama Hiroshima Yamaguchi 3 2 1

20 14 Takenori Inoki Total Directors of Employment Securities Director Generals etc. 36 Tokushima 2 37 Kagawa Ehime Kochi 40 Fukuoka Saga 42 Nagasaki Kumamoto Ooita Miyazaki Kagoshima Okinawa 4 4 Deputy Director- Generals etc. MINISTRY OF LABOR (MOL). Table 5 shows the numbers of loans and transfers from MoL to prefectures. Since these are not the numbers of staff but the numbers of transfers that current staff have experienced, they are larger than the numbers listed in the MoL column in Table 1. MoL elements that were also originally a part of the IM display a high loan rate, which was brought about by the practice of local postings of MoL bureaucrats from the Tokyo office. These bureaucrats stationed in prefectural government are responsible for collecting data concerning local employment conditions and employment insurance accountings. They usually become directors of the Employment Securities Division, but in some cases, as in Niigata and Fukuoka, they are assigned to the position of director-general of the Labor Bureau (Rôdôbuchô). Receiving prefectures are spread throughout the nation. This must be the traditional personnel policy inherited from the time of the IM. The large number of loans from MoL is related to Chihô-Jimukan Seido, or the localized national employee or the local office system in prefectural government. This rather special system is not an agencydelegated function. The officers who handled the central government work are posted at prefectural positions such as job placement offices. We will see below the typical career of an elite MoL bureaucrat in postwar Japan. A CAREER EXAMPLE AT MOL. Mr. C graduated from the Law Faculty at the University of Tokyo in 1956 and entered the MoL. His first job was as a personnel officer in the Department of General Affairs in the Central Labor Commission in Tokyo. A year and half later, he moved to the Labor Standards Bureau in Hokkaido as a supervisor of its staff members, as well as a researcher looking into the working hours of taxi drivers and the labor conditions of miners and fishermen in Hokkaido District. In July 1958, he returned to the Employment Security Division of the MoL to participate in designing an employment policy (legislation similar to the Employment Act in

21 Personnel Exchange Among Central and Local Governments in Japan 15 the United States). This effort was not actualized as law, because there were complications related to collaboration with the Economic Planning Agency. Until 1965, he participated in enacting laws such as the Employment Promotion Corporation Act (1961), the Unemployment Remedy Act (1963), and the Employment Measures Act (1965). Then, in August 1965, he was sent to Kumamoto Prefecture as director of the Employment Security Division. In this position he supervised nearly 260 employees and engaged in personnel management of the division and in the administration of the employment insurance scheme. He also served as director of public finance in the same prefecture for another two years. From 1970 to 1974, he served as first secretary in the Japanese Embassy in London and covered economic and labor relations problems in England. After his return to Japan, his career expanded from the Employment Securities Bureau to the Trade Union Bureau in MoL. After serving as director-general of the Labor Standards Bureau during of , he retired from MoL in 1987, and has since served in several offices and councils connected with MoL as public corporations. By following his career, we can clearly observe the pattern of the personnel transfer scheme in MoL, although his career was not as far-reaching as the MoHA staff in general. Yet the careers of the postwar MoL bureaucrats still show a remnant of the prewar career pattern of IM bureaucrats. MINISTRY OF WELFARE (MOW). University-graduate career officials in MoW are usually stationed in prefectural government at least once in their careers. In contrast, the careers of the staff, recruited among high school graduates and those finishing college while serving in MoW, are generally confined to the Tokyo office and are not extended to posts in the local government. Specialists in medicine, pharmacology, and actuarial statistics are treated as non-career bureaucrats in the framework of the MoW personnel policy. Those who were recruited by the local government also move across prefectures and between Tokyo and local governments. Career officials are transferred to the post of director-general of the Hygiene and Health Bureau, director of the Social Welfare Department, or to the Social Insurance Department in local governments. Director-general positions in the Police Bureau in prefectural governments are sometimes occupied by MoW bureaucrats from Tokyo. This may demonstrate that the MoW still carries over the personnel policy from the time of the IM. Indeed, MoW shows a high loan rate compared with other ministries ( see Table 3). The prefectures that receive career officials from Tokyo are spread nationwide, with the exception of Miyagi, Gunma, Tokyo, Nagoya, Gifu, Kyoto, Hyogo, and Nagasaki. Here again, the prefectures with large urban areas are not included. Thus MoW personnel policy implicitly but clearly differentiates the human resource development of career officials from that of non-career officials in the span of experience gained through the loans and transfers program between MoW and local governments. As for the role of the prefectural government, we can again observe a tunnel-like function of the prefectural government between Tokyo and the municipalities. The service for the public nursery is a clear example. The prefectural government checks the nursery standard and admission criteria for the public nursery, and there is little room for discretion. Since each

22 16 Takenori Inoki municipality has its own demand for nursery service, the municipal government has a policy for fees paid by parents and the municipal expenditure for its cost. Here again, the central government does not (or cannot) exert any power on the prefectural or municipal government (see Muramatsu 1988, pp ). Other Ministries We have outlined the general trend and structure of intergovernmental loans and transfers of human resources between MoHA and other Interior-related ministries and local governments. Ministries not linked by inherited function or traditions to the prewar Interior Ministry appear to show slightly different patterns. This can be observed, for example, in the cases of MoF (Ministry of Finance) and MoE (Ministry of Education). MINISTRY OF FINANCE ( MOF ). Deputy governors (the highest local post that can be held without direct election) of at least four prefectures Okayama, Toyama, Iwate, and Aomori are sent from MoF. We can observe from table 6-3 that the number of loans from MoF to director-general positions in prefectural governments are heavily concentrated in eight prefectures: Aomori, Yamagata, Ishikawa, Mie, Shiga, Wakayama, Tokushima, and Kumamoto. Each prefecture has a rather fixed relationship with the MoF in the post it offers to MoF. Mie, Tokushima, and Yamagata regularly offer the post of the director-general of general affairs (Sômubuchô) to MoF staff. Kumamoto offers the post of the director-general of planning and development, whereas Wakayama and Aomori offer the Fiscal and Economic Section directorship. The case of Ishikawa Prefecture is striking, in the sense that all three important directorships are occupied by MoF staff from Tokyo. It is certainly difficult to connect this personnel movement with any financial advantages given to prefectural governments. In order to verify the existence of such a causal relationship, we have to define the starting point of such a personnel loan and explore whether any simultaneous changes in financial or budgetary conditions have occurred in the local government concerned. However, we can at least say the following: The local government usually has frequent contact with the central government, especially with MoF and MoHA, because these two ministries have considerable power to control local finance. 2 The governor must also constantly approach LDP, which exerts considerable control over the actual budgetary process. While the central government has to depend on the local government because of its local connections to political parties, the local government must depend heavily on the central government with respect to local finance. In this way, there is a mutually beneficial, interdependent relationship between the central and local governments. 2 These two ministries, in most of the cases, exert opposite pressures on the budgetary process the influence of MoHA is expansionary to local finance, and the influence of MoF is contractionary.

23 Personnel Exchange Among Central and Local Governments in Japan 17 Table 6: Loans and Transfers in the Ministry of Education (MOE) Number of Loading Staff Listed in 1996 Directory Recruited by MOE as University Graduates Loaned to Prefectures (to Prefectural Education Commission) Transferred to Embassy Facility Administration & Other Specialist Jobs Others 2. Recruited by MOE as High School Graduates and later Graduated from Universities Loaned to Prefectures 3. Recruited by Local Office (National Technical High School, National University, etc.) and transferred to MOE: All High School Graduates 4. Transferred to MOE from High School Teacher, mainly as Textbook Specialist 5. Transferred to MOE from College Teacher mainly as Senior Curriculum Specialist 6. Loans from Other Ministries 7. Loans from Private Firms 8. Loans from Others MINISTRY OF EDUCATION (MOE). In MoE, there are several categories of staff; placement is made according to educational background and career before being transferred to MoE (see Table 6) The first and the most dominant group includes those recruited by MoE as university graduates, who form the main body of so-called career MoE bureaucrats. The members of this group are listed in the loans and transfers program of MoE and prefectural governments. As shown in Table 6, this group numbers approximately 150 out of the 400 listed in the 1996 directory. Out of these 150, more than 100 have been loaned to prefectures for two years during their careers, mainly to Prefectural Education Commissions (Kyouiku-iinkai). Their connection with local government is tightly formed and is said to endure in their careers.

24 18 Takenori Inoki These transferred career officials perform a wide variety of jobs in local government. The most common position is in the Prefectural Education Commissions, but sometimes, although this is rather exceptional, these officials assume such positions as public relations section chief or supervisor of planning and development (Kikaku-kaihatubu Sanji) in prefectural government. Non-career staff have an entirely different path. Approximately 100 non-career MoE officials were recruited directly by MoE as high school graduates and obtained bachelor's degrees while serving MoE. In striking contrast to the career officials, only 3 out of these 100 non-career MoE employees have the experience of being transferred to prefectures. There is a clear-cut duality between career officials and non-career officials in the loans and transfers policy. It is worth noting that prefectures receiving staff from MoE do not include prefectures with large cities such as Tokyo, Kanagawa, Saitama, Aichi, Kyoto, and Osaka. Prefectures located in rural regions, such as Akita, Fukui, Yamanashi, Tottori, Saga, Miyazaki, and Okinawa, are excluded. Such geographical that is, urban-rural regularity may partly be a result of political tension among the MoE, Prefectural Education Commissions, and teacher s associations in these prefectures. Discussion In the previous section, we surveyed the extent of loans and transfers from the central to prefectural governments for three groups of ministries: (1) MoHA, (2) the Ex-Interior-related ministries, and (3) other ministries. This (mutual) personnel exchange was extensive and deep, especially in MoHA and other offices related to the former IM, such as MoC, MoW, and MoL. Such exchange is also observable, although to a lesser extent, in other ministries, including MoE and MoF. In this section we will discuss the possible interpretations of this unusual practice of personnel loans and transfers between the central and local governments. It is very important to distinguish between the intention and the results of this policy in the following discussions, because loan practices may have produced an unintended result. This is particularly true for the hereditary nature of staff exchange. For instance, once the exchange is implemented and repeated a few times, it tends to become an expected practice. If the local government declines renewal of the staff loan, it may imply either a low evaluation of a specific loaned person or implicit non-cooperation with the ministry. In this sense, the loan is sometimes irreversible. The loan could continue, although its original purpose had been fulfilled or had disappeared. There are, however, possible benefits in this policy for both sides. Transfer of the Payroll to Local Government What sort of benefits exist for the central government? Apart from the possible "expansionist" efforts by the central government in obtaining posts in local governments, as mentioned in the case of MoC, one obvious reason for this practice is budgetary. Staff on loan from the central to a local government are usually paid by the local government. They once formally retired from their central ministries and were re-employed through the "interview test," perfunctorily conducted by the prefectural government. This practice substantially

25 Personnel Exchange Among Central and Local Governments in Japan 19 decreases the salary burden of the central government. It means that, given that the number of staff in the central government is constant, the personnel transfer policy reduces the budgetary burden of ministries by shifting salary payrolls to local governments. Furthermore, since they are scheduled to return to their home ministries after gaining experience in each prefecture, they no doubt bring back rich information on the socioeconomic problems of the prefecture they served. This truly constitutes a great invisible benefit to the central government, which incurs virtually no cost. On-the-Job Training for the On-the-Spot Information The loans and transfers personnel policy is sometimes directly connected to the implementation of a specific policy. Large-scale projects, such as construction of an airport or new trunk-line railway, pollution control, and fiscal reconstruction, are usually carried out not only by the funds and staff in local government, but also by the funds and information network offered by the central government. These projects, because of the nature of the joint work by the two levels of government, usually provide good opportunities for the central government staff to experience OJT. Through this personnel policy, transferred staff are extensively exposed to politically important issues on the administrative front in local governments. They can collect and convey information (so-called "good items"), which they hope will help vitalize regional public policies that are designed or partly assessed by the central government through local tax grants and nationwide industrial policies. The central government is in great need of information pertaining to local issues in order to make their policy scenarios indispensable or inevitable. This point is closely related to the reason that OJT is necessary in the careers of bluecollar workers and as an efficient method of transmitting information on the skills and knowledge required in an economic organization. Specific knowledge that spreads extensively at the production site, rather than general and abstract knowledge acquired by schooling, sometimes plays the most important role in the productive operation of an organization. This kind of knowledge and skill is extremely difficult to transmit except through the intermediation of individual contacts based on demonstration or direct observation. Such specific knowledge can be acquired through experience in the front lines of production. In this respect, we are able to see some analogy to the case of administrative work performed by bureaucrats. They are also supposed to gain experience in the front lines of administration. And these front lines are administered by local government. Accordingly, the importance of the two-way exchange of personnel will increase further, because no organization can be sustained solely by career bureaucrats who have only meager knowledge of the actual problems on administrative fronts. Receivers' Benefits It is unnecessary to emphasize the important role of transferred officials in the local office as a pipeline extended from the central government. Benefits, however, are also realized by the receiver. Through this personnel system, prefectural government can carry out bold and drastic policy changes, with accountability, if required, ascribed to the new staff from the

26 20 Takenori Inoki central government. And at the same time, this transfer system can mitigate the personnel tension that frequently exists among local staff. The staff from the central government return to Tokyo after two or three years, and on returning, they leave "great gifts" (new projects or public works) to the local government they served. The host prefecture usually acquires a reliable information pipeline, which may bring about additional allocation of supplementary budget or promising projects in formulating the budget, both on the national and the prefectural level. This kind of information pipeline certainly increases the probability of luring industrial plants or welfare investment to the prefecture concerned. In other words, such a pipeline will be crucial in luring public or private investment, which is expected to have a large economic effect on the regional economy. Power Dimension Disbandment of the IM did not represent a complete discontinuation of its power. Its human resources and functions were substantially taken over by such ministries as MoHA, MoC, MoL, MoW, the Ministry of Transportation (MoT), and the National Police Agency (NPA). It is perfectly natural that, even after the IM had been dissolved, the human resources spread, and remained in each new ministry at the start of the bureaucratic reorganization in And the practice of transferring officials from these new ministries to local governments, once accepted, was generally irreversible. In this case, the prewar power relationship survived, if not completely, in the central-local context. Another form of the power dimension emerged in the case of a local government that needed financial assistance from the central government. Personnel transfers, for instance, may have started to save local governments from financial crisis, as in the case of Kitakyûshû-shi, which yielded a number of posts to the bureaucrats from the central ministries (see the large number of Kitakyûshû-shi in Table 2. In such a case, it is inevitable that the local government concerned will become subordinate to the central government. At least through interviews, however, we had the impression that most of the transferred officials had rather weak voices and powers in administrative decisions in local governments, although there is no appropriate indicator to measure the strength of these powers. Generally, these transferred bureaucrats are not opinionated when they are working in local governments. There are cases where the local government wants to have staff from the central government to strengthen or neutralize its administrative machine. This is true, especially when a new governor, in a heated electoral competition, has defeated an incumbent political rival whose influence would remain strong in the local government. This balancing of power structures in local administrations tends to increase colonized positions in the local government. Furthermore, MoF often uses positions in field offices to promote political support for the candidate in the constituency of the field office concerned.

27 Personnel Exchange Among Central and Local Governments in Japan 21 Equalizing Functions of Human Resources As we have seen, the streams run two ways: from central to local, and local to central. This personnel exchange system may be functioning partly to equalize the quality of human resources in the center-local governmental system. Aptitudes of bureaucrats, as a matter of course, cannot be measured solely by the difficulty of the admission exam. The exam for career officials in the central government, however, is extremely difficult compared with other qualification examinations. If this exam is an effective screening device for human resources, transferring officials from the central to the local governments tends to raise productivity nationwide through the principle of equalization of marginal productivity. In this sense, the loans and transfers policy may have desirable effects on the productivity of human resources on the national level. Another important outcome is that this system promotes the training of local officials in a broader perspective and exposes them to wider opportunities to learn, thereby equalizing human resources in the country. We turn now to the issue of the transferability of the Japanese practice of intergovernmental personnel exchange to other countries. Needless to say, we must be careful in transferring a selected practice or institution from one society to another, because the conditions surrounding or underlying a particular practice may differ markedly from society to society. There are, however, a few points worth noting here. First, this personnel policy indicates a rather high turnover (mobility) of human resources between the central and local governments. Experience in the local government both deepens and widens through a OJT on the front lines of the local administration. Knowledge and skill acquired through such a training process enriches the careers of staff who are in this policy program. The same is also true for the counter-stream from the local to the central government. MoHA has recruited young, able officials from local governments on a permanent basis and trained them as non-career bureaucrats. These staff could, therefore, develop better careers, either in MoHA or in the local government. Although this practice began to weaken in the late 1970s because of the improved quality of life and human resources in localities, this exchange system still plays an equalizing function in human resources in the central and local governments. Second, this personnel exchange provides a broad and reliable screening process. The staff tend to be positioned in different offices and to be evaluated by several different supervisors (both in local and in central governments). They are trained and exposed to various types of jobs in the two governments, ranging from routine operations, to policy design, to legislative procedures. Through such a variety of experience, their aptitudes and trainability are discovered, and the selection process works effectively. Thus, on the one hand, this personnel exchange policy may in some cases infringe on the autonomy of local government, but on the other, it increases not only the information flow in central-local relations, but also the efficiency of human resource development of bureaucrats nationwide.