In an effort to clear the air over Japan Highway Public Corp.’s disputed balance sheet, transport minister Nobuteru Ishihara said the government will draft its own version of the public entity’s financial standings and present it to the Diet.
“The government needs to draw up a proper balance sheet and clarify (items such as) cash flow and assets” before the bills to privatize Japan Highway and three other highway operators are submitted to the regular Diet session that opens in January, the land, infrastructure and transport minister said.
A balance sheet released by Japan Highway in June shows it had a positive net worth of 5.76 trillion yen as of March 31. But the existence of a “secret” balance sheet drawn up by a project team last year shows the entity is actually in capital deficit.
In line with a December report by a key government panel, Japan Highway and the three other bodies will be privatized in fiscal 2005. The panel proposed that they be realigned into five companies that would manage and operate the nation’s expressways, which would be owned by a separate body that would repay the four highway corporations’ huge debts using toll revenue.
Ishihara said that while he will respect the panel’s proposals, detailed discussions on the realignment of the bodies will have to wait until he examines plans currently being hammered out by the ministry.
According to the panel’s proposal, the expressway operators would purchase assets from the asset-holding body over a 10-year period before going public. But Ishihara said the implementation of this scheme will depend on the actual state of Japan Highway’s balance sheet. There is not enough reliable data at present to back up Japan Highway’s claims, he said.
“While (the panel) may say the expressway operators should purchase assets in 10 years and go public, they cannot do so if they are in the red,” Ishihara said.
The imbroglio over the balance sheet has put Japan Highway President Haruho Fujii on the ropes. Skeptics claim the pessimistic balance sheet was purposely hidden to thwart privatization efforts.
Immediately after his appointment as transport minister, Ishihara said Fujii will have to resign if he cannot provide a proper explanation for the existence of two balance sheets. On Wednesday, Ishihara said he hopes to meet with the highway corporation head soon to discuss the issue.
“I’d like to have a talk (with Fujii), and then decide” what to do with him, Ishihara said. “It’s not a matter that can be put aside for a month or two.”
Separately, Ishihara also addressed the government’s plan to expand Tokyo’s Haneda airport and turn it into an international airport for regular short-distance flights by 2009.
Construction of “a fourth runway (with a length of 2.5 km) would greatly help with urban revival and economic revitalization,” he said.
He said the ministry must first satisfy certain conditions, including selecting the construction method for the fourth runway, gaining the understanding of local residents and asking the eight local governments concerned to share the financial burden of the expansion project.
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