Japan: Post services 43.3bn yen in the red

Japan: Post services 43.3bn yen in the red
From BBC INTERNATIONAL REPORTS (ASIA ECONOMIC), June 13th, 2001

Text of report in English by Japanese news agency Kyodo Tokyo, 14 June: Government-run postal service operations are
estimated to have posted a deficit of 43.3bn yen for fiscal
2000, far more than the initially expected 35.1bn yen, according
to government financial statements made available Wednesday [13
June]. The statements were compiled by the Ministry of Public
Management, Home Affairs, Posts and Telecommunications based on
guidelines issued by the ruling Liberal Democratic Party’s [LDP]
Administrative Reform Promotion Headquarters. The LDP guidelines adopted evaluation methods used to assess
private companies’ businesses, stricter than the methods that
have been used to evaluate postal service operations. The Postal Services Agency, which is running the services, is
expected to become a public corporation in 2003. With such poor business results, the public corporation may
inevitably start the postal service business in the red. According to the statements, revenues from postal service
operations amounted to 2,260bn yen during fiscal 2000, which
ended 31 March, while expenditures amounted to 2,002.6bn yen, a
large part being payroll costs. After allocating 126.9bn yen to retirement-allowance reserves
and putting aside 113.5bn yen for depreciation costs for
facilities and equipment, the balance comes to a loss of 30.7bn
yen. Including some nonoperating items such as 18.9bn yen in interest
payments for loans from government coffers, the operation’s
overall deficit comes to 43.3bn yen. The Postal Services Agency had estimated the deficit to be about
35.1bn yen for the fiscal year. Meanwhile, the government’s special account for postal service
operations has total assets of 13,128.2bn yen, consisting of
6,591.6bn yen in deposits in the postal savings programme and
3,110.5bn yen in land purchased as investments. The assets exceeds total liabilities of 11,217.1bn yen. Of the
liabilities, 2,303.8bn yen was reserves for retirement
allowances. Source: Kyodo News Service, Tokyo, in English 1658 gmt 13 Jun 01 BBC Monitoring. Copyright BBCBBC INTERNATIONAL REPORTS (ASIA ECONOMIC), 13th June 2001