Postal bills become law

Saga ends in triumph for Koizumi

by Reiji Yoshida

The hotly contested postal-privatization bills that have been at the center of a political firestorm this year were finally approved Friday, passing through a House of Councilors plenary session with relative ease.

The same chamber had killed a set of practically identical bills on Aug. 8, triggering a House of Representatives election and precipitating seismic changes to the nation’s political landscape.

On that occasion, 22 lawmakers of the Liberal Democratic Party had voted against the bills, while a further eight were absent or refrained from voting to protest Prime Minister Junichiro Koizumi, the main proponent of the bills.

The legislation was thus defeated 125-108.

This time, however, the 241-seat chamber passed the bills in a 134-100 vote. The number of votes in favor was only two fewer than the 136 seats occupied by the LDP-New Komeito ruling coalition.

“This is a miracle in politics,” Koizumi said before a TV camera Friday afternoon at the Prime Minister’s Official Residence. “This miracle has been realized thanks to people who have supported Koizumi.”

Koizumi indicated that he may be flexible in his punishment of the Upper House members who voted against the bills last month but supported them this time.

“The situation of each (Upper House) member is different. I have asked (the LDP leadership) to carefully consider it,” Koizumi told reporters.

Asked about an apparent contradiction in the treatment of postal rebels in the two Diet chambers, Koizumi said only that he would leave the matter to the party’s executives. The Lower House postal rebels were denied official LDP candidacy in the Sept. 11 general election and had to run as independents.

The postal-reform package will see the nation’s state-run postal services — which command 330 trillion yen in assets, or a quarter of all the financial assets held by Japanese individuals — incorporated into five new entities beginning in October 2007. All shares in the two new entities that will handle postal savings and postal insurance will be sold on the market by October 2017. The entity that takes control of the massive pool of savings is expected to become the world’s largest bank in terms of assets.

Most of the LDP members who rebelled in the last vote toed the official party line this time, acknowledging the LDP’s landslide victory in the Sept. 11 Lower House general election, which the prime minister called immediately after the Upper House rejected the bills.

The LDP-New Komeito ruling coalition now occupies more than two-thirds of the Lower House, most of whom now support the postal-reform drive.

Prior to the general election, Koizumi had denied official LDP candidacy to all of the 37 Lower House members who had voted against the bills in July.

LDP lawmaker Atsushi Onita, who abstained last time, was asked by reporters why he voted for the bills this time.

“Because the ruling parties won a large number of seats (in the Lower House),” he said.

The focus of political attention has now shifted to what Koizumi will do during his remaining months in power. He has pledged to step down in September 2006.

Koizumi reportedly plans to reshuffle his Cabinet, along with the top executives of the LDP, at the beginning of November.

He has indicated that he will give ministerial posts and party executive posts to politicians he believes can maintain his reform drive.

The qualifications of the person succeeding him as prime minister should include a commitment to the continuation of his emphasis on small government, with administrative reforms and a relatively austere budget policy, Koizumi has said.

The Upper House passed the bills after starting debate them as late as Wednesday. A special committee on postal issues initially passed the bills earlier Friday, followed by the plenary session.

Opposition parties claim that the new entities will still be under strong governmental influence and will not be able to channel the huge funds held by the postal services into the private sector, as was originally envisioned by advocates of postal reform.

The state-linked holding company, more than one-third of which will be owned by the government, will be allowed to buy back shares if the management wants to after October 2017.