Abstract
This article examines role of House of Councilors in policy formulation process after the 2010 House of Councilors Election, in which opposition parties appeared victorious, causing a divided government. It covers policy formulation from the beginning of 176th Diet to the passage of government bond bill at the end of 177th Diet. It shows that the Kan Naoto cabinet had to abandon enactment of important bills as well as amend content of important bills as the House of Councilors was dominated by the opposition parties. It further demonstrates that the cabinet had to revise budget policy in order to pass budget related bills such as government bond bill. This article reaffirms that the House of Councilors has strong influence over legislation and finds that its sphere of influence is not limited to legislation but can be extended to budget as it can control passage of budget related bills.
