New shakeup planned for Japan Post

Ministers Kamei, Haraguchi clash

Kyodo News

The new administration of Prime Minister Yukio Hatoyama has started considering reorganizing five arms in the Japan Post Group into three entities by having Japan Post Holdings Co., the core holding firm, absorb two of the five, government sources said Thursday.

The reorganization plan calls for having the holding firm absorb Japan Post Network Co. and Japan Post Service Co., whose profitability is widely feared to deteriorate, the sources said.

The reorganization is designed to enable the group to continue to offer mail delivery services nationwide with uniform quality without compromising service to sparsely populated areas, they said.

Internal Affairs and Communications Minister Kazuhiro Haraguchi said in a television program Thursday the new government aims to maintain the post office network by integrating the holding firm, the mail service and post office units. However, Shizuka Kamei, state minister in charge of postal issues, said Friday that nothing has been decided yet.

Haraguchi “does not have the authority to speak about projects under my jurisdiction,” said Kamei, the leader of Kokumin Shinto (People’s New Party), the Democratic Party of Japan’s junior coalition partner.

Kamei’s remark, a shot across the DPJ’s bow, indicates a divisive showdown may be forming in the coalition Cabinet just two days after its formation.

“I want to make postal services beneficial to the local economy,” Kamei said.

Meanwhile, Haraguchi said at a regular news conference that his plan is just one version of what the postal services could become, adding that the three ruling parties will deliberate on the details.

The plan that surfaced Thursday intends to integrate the reorganization proposal into a bill that the ruling coalition’s three component parties — the Democratic Party of Japan, the Social Democratic Party and Kokumin Shinto (People’s New Party) — are now drawing up for submission to an extraordinary Diet session to convene later this year, they said.

When the Postal Services Agency was split up in 2007 to accomplish an eventual privatization, the government put Japan Post Bank Co. and Japan Post Insurance Co., in addition to Japan Post Network and Japan Post Service, under the holding company.

But since Japan Post’s operations were divided up into the five arms, it has undercut the quality of these postal services in sparsely populated districts, particularly in mountainous areas, while generating sharp differences in the levels of profitability for the five arms.