Understanding the FILP system
The Fiscal Investment Loan Program (FILP) is a government-run financial system that mobilizes and allocates savings in the form of investments and loans that serve public policy purposes. As discussed in more detail in the next chapter, the Japanese government built the FILP system over a number of years using preexisting government programs, including the postal savings program that dates back to the nineteenth century. During this time, the government added new sources of funds and made critical structural changes that centralized and expanded the funds available at its disposal and changed how these funds could be used.
FILP is used as a term of convenience, but it actually refers to an amalgam of distinct but interrelated institutions. These component parts, governed by different laws, evolved into the FILP system; thus, there is no one specific piece of legislation that created FILP per se. Nonetheless, FILP functions as an integrated financial system. This chapter provides an overview of the FILP system: what it is, how it has functioned, how it has changed, and what existing research has illuminated about it. The chapter then compares the FILP system to policy finance systems in other countries. Finally, the chapter lays out the analytic framework for the remainder of the study.
FILP is commonly described as having three parts: entrance, intermediary, and exit (see Figure 2.1). The entrance refers to the various sources of funds for the FILP system; the intermediary centralizes the government’s management