Since mid 1990s Japan has been promoting a big scale reform of the basic governmental institutions. Transfer of functions to local goverments, deregulation, reshuffle of government ministries and financial structure reform are advancing and the civil service reform has just started. These reforms are to reform a govermental organization that has grown excessively large and rigid, and to realize a streamlined, efficient and transparent goverment that permits effective execution of important state functions. In this article, political or law-making process of two reforms are analyzed. One is the reinforcement of cabinet functions. In order for the Cabinet to conduct substantial policy discussions, and to function as the principal instrument for a top-down approach to the formation and execution of policy, it is necessary to reinforce the Cabinet functions and to strengthen the "leadershp of the Prime Minister" The second is the establishment of independent administrative corporations. Government organizations are criticized because of inefficiency, rigidity and a big financial deficit. So independent administrative corporations are established as a strong tool for increasing efficiency and improving the quality of administrative services.