April 26, 2025

Government to Leverage AI for Smarter Policy Decisions

The government is set to begin testing artificial intelligence (AI) to improve policy formulation. By analyzing data from over 5,000 subsidized and public projects, including goals, budgets, and outcomes, AI aims to optimize policy design and budget allocation. The initiative is expected to be fully implemented by FY2028.

Starting in April, a private consulting firm will conduct a year-long study of existing projects. AI will analyze "government project review sheets," which track budgets and results, to refine its ability to make accurate recommendations. It will also identify cost-saving opportunities and shareable technologies across different projects.

Currently, these review sheets are utilized to monitor project progress, budget status, and goal achievements. However, establishing clear goals and fairly evaluating results can be challenging, especially for large-scale ministries managing numerous projects.

An official noted, "In ministries with many ongoing projects, it’s difficult for staff to monitor every detail." After an initial preparation phase, AI is expected to be fully integrated into the management of public projects by FY2028, aligning with the renewal of the current system.

In its early stages, AI will help structure project overviews, assess goal alignment, and streamline evaluation processes. Over time, it will assist in shaping policies, including calculating appropriate budgets, project scales, and maintenance plans for infrastructure projects, while also evaluating regional economic impacts. The ultimate goal is to ensure efficient fiscal spending and improve service delivery based on past project outcomes.

Globally, governments are already using AI. In the UK, AI helps manage benefits for low-income households and detects fraud, while Singapore uses AI to analyze traffic and enhance public safety. As societal needs grow, governments are under pressure to meet rising demands with limited resources.

To support this transition, the government has allocated 410 million yen in the FY2024 supplementary budget for research aimed at improving system functions. This investment seeks to enhance data accessibility and reduce administrative burdens, allowing civil servants to concentrate on policy development and work reform.