Prime Minister Ryutaro Hashimoto asked the presidents of seven JR group firms Wednesday for their understanding over the government's standpoint on the draft bill that outlines burden-sharing by the seven to cope with the 27.8 trillion yen debt amassed by the former Japanese National Railways.
However, the meeting was unproductive because the presidents reiterated that their firms cannot shoulder the burden, and they asked the prime minister to exempt them from the additional costs.
In the meeting, Hashimoto said the draft bill is one of the most important issues in the ongoing fiscal structural reforms, and the government cannot further delay the solution to the JNR debt problem, according to a Transport Ministry official.
In the bill, designed as an overall plan to dispose of the huge debt, the government plans to have the firms bear 360 billion yen in pension costs for former JNR employees who now work for the JR carriers. The government hopes to get Cabinet approval of the bill and submit it to the Diet on Friday.
Hashimoto also told the presidents that the government will leave the door open to further discussion on the matter with the firms, according to the official. "We continue to insist on our basic standpoint on the privatization (of the former JNR) and hope to obtain understanding on it ... I appreciate the prime minister's proposal to continue the talk from now on," said Masatake Matsuda, president of East Japan Railways Co., after the meeting with Hashimoto.
The firms maintain they already bear a financial burden in the debt issue -- a 14.5-trillion yen debt, inherited from the former JNR when it was privatized and the JR group firms created. They noted that they also bore a reasonable amount of the pension cost last year.
The government is asking them to bear 360 billion yen out of the 770 billion yen needed to make up for a reserve shortage when the former JNR employees' mutual pension fund was merged into the Employees' Pension Insurance last year. The firms paid 170 billion yen in merging costs at that time.
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