Aso says division of Japan Post into 4 firms should be reviewed
Prime Minister Taro Aso called for a review of the current four-company system under Japan Post Holdings, questioning its efficiency.
Prime minister Taro Aso called for a review of the current four-company system under Japan Post Holdings, questioning its efficiency.
“Is it really efficient to have four separate companies? I believe it’s time to review the issue once again,” Aso said at the House of Representatives Budget Committee.
When privatisation began in October 2007, Japan Post was subdivided into four firms: Japan Post Service; Japan Post Network; Japan Post Bank; and Japan Post Insurance.
Aso’s comment likely will create a stir because a review of the current four-company system could shake the foundations of the privatisation of the postal service, under which postal services and financial services were split to lower risks.
Some members of the ruling Liberal Democratic Party are urging that Japan Post Network, whose business remains sluggish, be merged with another company within the group, such as Japan Post Service, in order to safeguard the nationwide postal office network.
Aso is believed to have made the comment with such an opinion in mind.
“Because [the postal services] have been privatised, an unprofitable system is unacceptable,” Aso told the Budget Committee meeting. “The [four Japan Post] companies need to be appropriately managed to ensure they generate profits.”
Internal affairs and communications minister Kunio Hatoyama, who is in charge of postal privatisation, expressed his intention to comprehensively review the privatisation of the postal service.
“We’ll thoroughly review the reform, which is postal privatisation, and there will be no sacred cows,” Hatoyama said. “We’ll deal with the issue based on the premise that anything can be done as long as the services are not returned to the government.”
Aso and Hatoyama made their statements in response to questions by Nobutaka Tsutsui, a lower house member of the main opposition Democratic Party of Japan.
The postal privatisation law, which was passed in October 2005, includes a provision requiring examination of the progress of postal privatisation.
In line with the provision, the government’s postal privatisation committee, which is headed by economist Naoki Tanaka, plans to submit a report to the prime minister at the end of March.
Following the prime minister’s statement, attention is now focused on whether the committee will go as far as commenting on what framework the four Japan Post firms should work in.
