Japanese panel to be given power to monitor privatized postal units

A committee to monitor four entities to be created by privatizing the state-backed Japan Post will be given various powers including advising Cabinet ministers, government sources said Monday.

The committee, whose chairman will be appointed by the prime minister, will be placed under the privatization promotion headquarters consisting of all Cabinet ministers, they said.

The committee will consist of several people with expertise and will begin its 10-year work in April 2007.

The government intends to include the establishment of the committee in legislation for the privatization of postal services it will present to the ordinary Diet session to be convened in January.

According to the government-set 10-year privatization process from April 2007, Japan Post will be split into four entities in charge of mail delivery, postal savings, postal insurance and post office network management.

A key issue for the privatization of postal services is how the four new units can expand their operations without inviting the criticism of eating into private companies’ businesses.

The government therefore hopes to smooth the privatization process by giving authority to the monitoring committee.

If, for example, the postal savings company plans to raise the maximum deposit amount of postal savings from the current 10 million yen or begin housing loans, the committee will be authorized to present its views to the minister of internal affairs and communications and the financial services minister.