Japan Post’s Ikuta against separation of financial services

Japan Post President Masaharu Ikuta on Wednesday expressed opposition to a plan to separate postal savings and “kampo” life insurance services from post office operations when the entity is privatised.

“I hear about a plan to separate financial services from counter work at post offices, but it has not taken into consideration the realities of the services at all,”Ikuta said at a press conference.

The government is reportedly planning to break up Japan Post’s three postal services of mail delivery, postal savings and”kampo”life insurance services when it privatizes the entity.

Ikuta said he is against the idea because separating the financial services will make postal officials lose contact with customers of such services.

The president also suggested expanding services at post office counters.”We should tap new businesses such as sales of government bonds and investment trusts and conducting administrative procedures on behalf of local governments,”he said.

Meanwhile, Ikuta lashed out at a governmental panel’s estimation that Japan Post owes 1.1 trillion yen to the public in the form of corporate tax and other obligations it is exempt from.

He said the panel calculated the figure based on profits in the Japan Post earnings report in a business year to March this year, which marked an increase on special factors such as higher stock prices.

Japan Post took over the three postal services from the governmental Postal Services Agency in April 2003.

The government plans to draw up a final report on postal privatization in September and privatize the entity in stages starting in 2007.