The Administrative Reform Council, a government panel headed by Prime Minister Ryutaro Hashimoto, on Tuesday virtually agreed that two separate statuses -- civil servants and "noncivil servants" -- should be created for government employees to be transferred to quasigovernmental organizations.

Only Jinnosuke Ashida, one of panel members and former chairman of the Japan Trade Union Confederation (Rengo), opposed the idea, saying the workers' current status as government employees should be maintained. The council has agreed to create a number of organizations tentatively called "independent agencies" to be modeled after British executive agencies, to take over non-policy related functions of the government.

During Tuesday's meeting, the government panel agreed that national museums and art galleries, a variety of national research institutes, national hospitals excluding national centers for specific diseases and the Labor Department of the Defense Facilities Administration Agency should be turned into independent agencies. Meanwhile, the panel gave up putting in its final report numerical targets for the reduction of the number of government employees, but decided to leave it to the government.

The panel had originally thought that workers of the new independent agencies should cease to be public servants in order to reduce the number of government employees. However, the proposal was rejected by Rengo, the nation's largest labor organization whose members include public servants, and the Social Democratic Party, which is backed by labor unions and one of the allies of the ruling Liberal Democratic Party.