Koizumi's drive to privatise postal services skidding to a halt
A new advisory panel will not be charting a course of action. The Asahi Shimbun Prime Minister Junichiro Koizumi's personal crusade to privatize three key postal services appears to be running out of steam. As the privatization debate enters a new phase, the prime minister pins his privatization hope on a "launch preparation" panel to pave the way for the creation of the public corporation that will take over control of the three services-mail delivery, savings and insurance-from the government's Postal Services Agency next April
But unlike the Advisory Council to Consider the Modalities of the Three Postal Businesses, whose members were handpicked by the reform-minded Koizumi, the preparatory panel basically will not have a say in how the eventual privatization of the postal system unfoldsSources say many in government circles had assumed Koizumi would call for the creation of yet another advisory panel with the legal authority to consider options for privatizing postal services. The panel they had envisioned would be much like the one that is now examining ways to privatize four road-related public corporations
But Koizumi made it clear that would not be the case after emerging from Tuesday's meeting of the postal privatization panel
"I don't plan to set up another panel of nongovernmental advisers. It's my wish that the public body that assumes control of government-operated postal services will serve as the vehicle for privatizing those services," he said
Observers say the move reflects Koizumi's belief that any attempt to create another advisory panel would simply ignite a firestorm of protest from members of his Liberal Democratic Party who oppose privatization because they have a vested interest in maintaining the status quo
The members of the preparatory panel will be named soon and will include individuals sympathetic to privatization, according to the prime minister
But because the panel, which is also expected to include bureaucrats, is restricted by law to merely "managing the process of setting up the public postal corporation," it remains to be seen if it will be able to drive privatization forward
Koizumi and Naoki Tanaka, chairman of the existing postal privatization panel, agreed Monday that discussions on how to privatize mail delivery and other services should be put on the backburner until it can be determined how the new public postal corporation fares in competition with private-sector rivals after its debut in April
But the question of when such discussions will actually resume remains unanswered
The privatization panel's report calls for deliberations to resume only after the new public body's initial medium-term management plans expire in fiscal 2006
Koizumi, however, maintains he will not heed the panel's advice on this point
The prime minister received another blow, albeit a long-anticipated one, on Tuesday, when his privatization panel failed to agree on the content of the proposals it plans to submit early next month
Panel members were unable to settle their differences and ended up offering three alternative plans for privatization, instead of a strong single recommendation
The content of the panel's report was largely agreed upon on Tuesday, when members met with Koizumi to discuss a memo prepared by Tanaka, the body's chairman, listing three optional courses for privatizing the three key postal services
One of the proposals is to establish a joint-stock company wholly owned by the central government to take over all three publicly operated services, while leaving the nationwide network of post offices untouched
The proposal would reduce the maximum amount that individuals are allowed to deposit in postal savings accounts. Presently, the limit is 10 million yen
It would also lower the limit on the coverage offered by postal insurance policies
The second proposal calls for setting up a joint stock company independent of the government that would absorb the three key services. The network of post offices would be maintained, but the new body would be allowed to close branches in sparsely populated areas if they proved unprofitable
The third privatization plan proposes that postal savings and life insurance services be terminated, and that postal delivery services be transferred to a private joint-stock company
The latter two proposals could reduce the reach of the postal system if the new entity decides that servicing remote locations does not make financial sense
Instead, local governments in such areas would be required to support the new postal body financially if it wanted services to continue in their areas.
Copyright 2002. All Rights Reserved.
