Table Speech

Initiation speeches

May 25th,2005

Mr.Hideyuki Aizawa
Mr.Yasuhisa Hirose  

Chairman of the System Development and Research Institute
Mr.Hideyuki Aizawa

The Scientific Method of Budget Forming

My classification is that of a think tank which is what my organization does. We ware organized in 1969, have 100 staff members and conduct research entrusted to us by central and local government offices.

 In the late 1940’s and 50’s there was a movement in the U.S. to free budgets from being influenced politically, and conduct studies based on cost and profit promoting a scientific fiscal administration. This was called PPBS (Planning Programming Budget System).

 Desiring to do the same, a budget of 100 million yen was created for this purpose. At the time, I was Vice Chief of the Budget Bureau.

 In preparing a budget, many requests are made, some worthy and others not so, and we must be able to discern the difference. But this must be done tactfully and it is best if we can offer rational reason for refusing the request.

Therefore we felt that the PPBS could be used for this purpose.

 A major issue at the time was the matter of bridging the inland sea, and determining the route. Five routes were proposed, but the Construction Ministry had reduced these down to three in 1967, but each of these candidates had powerful politicians behind them and the rivalry was intense, so we decided to utilize the PPBS.

 Finally, the Chairman of the Economic Planning Board decided that work on all 3 would be started together as it would be a means to buoy the economy.

 This would mean that our plans were overridden, but bureaucrats have their way, and with the starting time being simultaneous, a cost / performance rule was introduced, according to which the completion times would be staggered.

To summarize, the scientific procedure for forming a budget is difficult to be carried through in creating a balanced budget, but being responsible for your tax money we must work towards the most effective use of your money.

Therefore we will continue to use the PPBS method.

I have been Chairman of the System Development Research Institute, which is an organ to allow central and local authorities to reach their targets most effectively when they carry out their budgets in the style of PPBS, and we hope to continue our efforts in this direction.

President of the Enoteca Co. Ltd.
Mr.Yasuhisa Hirose

 I am sure that there are many persons in the audience today who were enjoying wine before I was born, and know more about wine than I do, but I hope you will allow me to talk about my business.

 The French always say ‘Wine is not alcohol, wine is wine’, and wine has many characteristics. Wine should be drunk with friends, and not alone.
Another characteristic of wine is that it has a vintage. When you drink wine with family or friends, the vintage year will recall fond memories and add cheer to the conversation. Wine is produced in almost every country.

 As enjoying music allows you to travel across borders while staying at home, wine does also.

 With all these fine characteristics, wine has not been popularly received in Japan. It is commonly said that in Europe, children drink wine, so in Japan where we are late starters, it is difficult to enjoy wine.

 But this is not true. The Japanese have a very sensitive tongue, and our food is quite delicate. Even if we are latecomers in drinking wine, many have discovered the pleasures of wine, and their understanding of it is second to none.

 Due to my business, I share the table with many wine company owners, and especially representatives from quality chateau in Bordeaux, France.

 I find that even persons who have managed a chateau for 30 years are unable identify their own wines. So please don’t give up and keep challenging.

When I jokingly say “Are you alright?” they say if you blindfolded and made to grasp the hand of several ladies, can you tell which is your wife?

 Now, let me tell you about the wine business in Bordeaux, which is the major wine producing area.

You will remember the major chateau such as Chateau Margot or Chateau Latoure and these all have agents in various countries, so anyone can make purchases.
But wine is the agriculture, and there is a limit to production. For the major chateau it is a seller’s market, and importers are given allocations according to past performance. The agent is the go-between for the producer and the importer. We communicate directly with the producer frequently, but all business is carried out through negotiation. Even in this IT age the old style system works very effectively.

 Then, how can we secure what we desire, and import it at a low cost? There is a Bordeaux system of lot purchase where wine can be purchased while it still in the barrel. This year is 2005, and the 2004 wine is now maturing in barrels which will be entering the market form summer to winter of 2006.

This wine is sold in 2004, and whatever, it will never be sold at a lower price.

So, buying in bulk is the way to buy wine most cheaply. The amount you can buy is determined by your previous record. It really is more complicated but this will keep for another time.

Thank you for listening to me. I hope that I will have occasion to hear from you about your friends and work while sharing a glass of wine. Wine is to be enjoyed, and at the table people are always in the main role, and wine is the by-players.