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Saturday, April 28, 2012

Eased postal reforms, Diet pay cuts passed


Staff writer

The Diet passed a bill Friday to amend the Postal Privatization Law and water down the postal reforms championed in the early 2000s by then Prime Minister Junichiro Koizumi, and a bill to trim national lawmakers' salaries for two years.

The two bills were approved by the Upper House with help from the main opposition forces — the conservative Liberal Democratic Party and New Komeito, which jointly submitted the bills with the ruling Democratic Party of Japan.

The enactment of the bills represents a legislative victory for Prime Minister Yoshihiko Noda, but his main priority — the social security and tax reform package — remains in danger because the opposition camp is refusing to join the talks until May. The Diet will close in June.

The postal privatization amendment is aimed at selling the government's two-thirds stake in Japan Post Holdings to fund Tohoku's recovery from the March 2011 earthquake and tsunami. The stake is currently estimated to be worth more than ¥6 trillion.

But the amendment scraps the deadline for the selloff, allowing the government to keep its hooks in the financial services juggernaut for an indefinite period. The original law required the government to sell off all its Japan Post Bank and Japan Post Insurance holdings by 2017, but the amendment merely states that the shares are to be sold "as early as possible."

The shares might have been sold sooner, but the DPJ froze the deadline for the sale in 2009 upon taking power for the first time ever.

The legislation will reorganize the Japan Post Group into a four-company system instead of five by merging Japan Post Service Co. with Japan Post Network Co.

When the bill cleared the Lower House on April 12, three LDP politicians, including Shinjiro Koizumi, son of former Prime Minister Koizumi, voted against it, although their party collectively approved the revision.

The party usually punishes dissenting members, but the LDP's vice president only issued them warnings to prevent divisions from forming within the party.

Meanwhile, the pay cut bill will reduce Diet members' pay by about 13 percent for two years, bringing their salaries to ¥18.3 million from ¥21 million.

The DPJ is hoping the pay cut will allow the government to show solidarity with the public as it struggles to pass Noda's bill to double the consumption tax by 2015.

Noda had been calling for the pay cut since March, saying it should be higher than 10 percent because the government has decided to cut top bureaucrats' salaries by at least 10 percent as well.

The prospects for the tax hike bill appear dim because time is running out. The Diet will close for the summer break in June unless it is extended.

On Thursday, the Lower House agreed to launch a special committee to discuss the social security and tax reform plan. The DPJ hoped to start discussions Friday, but the LDP and New Komeito refused.

Deliberations will kick off in the Lower House on May 8, but the special panel won't actually take it up until May 16.

At the same time, around May 7 and 8, DPJ Secretary General Azuma Koshiishi said he hopes to hold a meeting on reinstating the suspended membership of former party leader Ichiro Ozawa, who was finally cleared Thursday of conspiring to falsify his political funds reports.

This may pose another headache for Noda because Ozawa is adamantly against the tax hike bill, which can be voted down in the Diet if more than 50 of Ozawa's loyalists oppose the legislation.

Noda has to secure enough support both from his party and opposition camp to pass the bill because the opposition controls the Upper House.



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The Japan Times

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