The Great Hanshin-Awaji Earthquake Reconstruction Fund was established in April 1995 (with 900 billion yen in funds) to drive recovery for disaster-affected areas. From its inception until 2007, this fund spent approximately 360 billion yen on projects to assist housing, living, industry and education recovery in disaster-affected areas.

Case Study

The Great Hanshin-Awaji Earthquake Reconstruction Fund

Location

Hyogo Prefecture, Japan

Context

As it pursued its disaster recovery efforts, the Hyogo Prefectural Government was required to meet disaster victims’ diverse needs promptly and flexibly. The local government’s administrative system requires parliamentary decisions to obtain budgets for projects, which are normally unable to promptly resolve the challenges faced by the disaster victims. To make matters worse, the single-year-based budget accounting principles imposed constraints on its long-term perspective-based disaster recovery measures.

Under such circumstances, the Fund was established to implement projects to promptly meet the multifaceted needs of disaster victims over the long-term as well as on a stable and flexible basis.

Coping Strategy

To secure the budget to run the Fund, Hyogo and the Kobe City government decided to borrow a combined total of 880 billion yen from financial institutions and to provide interest-free financing to the Fund. This would enable it to complement the government’s programmes to support disaster victims  In response to the effort by local governments to bear the interest payments for the Fund, the national Government provided an ordinary local grant tax to them to cover part of their interest burden.

Results

By the end of fiscal year 2013 (March 31, 2014), the Great Hanshin-Awaji Earthquake Reconstruction Fund had implemented a total of 116 supporting projects valued about 365 billion yen in the fields of housing, living, industry, education and others areas thereby contributing greatly to the recovery from the Great Hanshin-Awaji Earthquake (GHAE).

Measuring Success

The Great Hanshin-Awaji Earthquake Reconstruction Fund complemented public funds in quantity by enabling the implementation of measures that were more rigorous than ordinary governmental programmes, and also carried out detailed projects that met the needs of disaster-affected people.

Potential for Replication

Following the Chi-Chi Taiwan Earthquake that occurred in 1999, the Taiwanese government established the 921 Earthquake Relief Foundation by making use of disaster relief donations, and enacted citizens’ life recovery and housing recovery to complement the government’s housing recovery policies.

While a significant amount of flexible budget is required for post-disaster recovery projects, the securing of such budgets is a major challenge for some national governments as the first step.

Other countries and regions cannot necessarily use the reconstruction fund scheme employed in Japan after the Great Hanshin-Awaji Earthquake without significant changes. This is because each nation or region differs in terms of culture, approaches to the right to life, housing and life environment recovery, as well as with respect to societal and economic structures. It is thus essential to design a scheme befitting the circumstances of the disaster-affected country or region.

Contact Information

Mr. Masahiko Murata – Director, Research Department

Disaster Reduction and Human Renovation Institution (DRI)

1-5-2 Wakinohama-kaigandori, Chuo-ku, Kobe, 651-0073, Japan

Tel: +81-78-262-5065 / Fax: +81-78-262-5082

Mail: murata1@dri.ne.jp

Mr. Naoki Nakatsu – Chief, Disaster Management Project Planning Division,

Disaster Management & Planning Bureau,

Civil Policy Planning & Administration Department

5-10-1 Shimoyamate-dori, Chuo-ku, Kobe, Hyogo, 650-8567, Japan

Tel: +81-78-362-9870 / Fax: +81-78-362-9914

Mail: naoki_nakatsu@pref.hyogo.lg.jp