Junichiro Koizumi’s inauguration as prime minister might have lifted the hopes of those who seek the privatization of the nation’s postal services.

Toranosuke Katayama

But Toranosuke Katayama, who was reappointed posts minister in the Koizumi Cabinet, is wary of, if not outright opposed to, the idea.

Katayama remarked that he will simply follow the existing law, which involves the transfer of the government’s postal service operations to a state-run public corporation to be set up in fiscal 2003.

“The framework has already been written into the law to transfer the postal business to a public corporation. The law also says the government won’t privatize it,” the minister of public management, home affairs, posts and telecommunications said in an interview. “I just cannot help but say that’s the national consensus because the Diet enacted the law.”

A senior Upper House member, Katayama belongs to the Liberal Democratic Party’s largest faction, led by former Prime Minister Ryutaro Hashimoto. The faction has a strong support base among those engaged in the state-run postal system, including the heads of local post offices.

Koizumi meanwhile has long advocated the privatization of postal delivery services, as well as the postal insurance and postal savings businesses.

The latter have been criticized for absorbing as much as 360 trillion yen of the 1.37 quadrillion yen in financial assets held by individuals.

The LDP and its coalition partners — New Komeito and the New Conservative Party — have thus far agreed to set up an advisory panel to the prime minister, charged with discussing the future of postal services. The panel will also discuss the privatization issue.

Just how soon a panel of this kind will be set up, however, remains in question.

During his interview, Katayama said he welcomes debate on the privatization issue but said the government should not skip a public corporation stage — a step that is required under current law.

Upon establishment of a public corporation, postal delivery services will be opened up to the private sector.

Katayama said, however, that the extent to which a market of this kind will be opened will depend on the public corporation’s ability to provide universal services across the nation, namely, delivering letters at a uniform cost.

“It will be no good if private companies skim the cream and the public corporation is deep in the red with unprofitable areas. We should maintain a balance,” he said.

As for the nation’s telecom market, Katayama said he is satisfied with a set of bills that have already been submitted to the Diet.

In their draft stage, the bills had called for stricter control of the dominant Nippon Telegraph and Telephone Corp. But they have since been diluted under pressure from some LDP lawmakers with strong links to NTT and its employees.

Katayama said the bills as they stand today maintain a balance between promotion and competition, weakening NTT’s domestic control and reinforcing its international competitiveness.

“The bills are well-prepared and (the two purposes) are compatible,” he said.

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