Prime Minister Junichiro Koizumi bows after the Lower House narrowly approved postal privatization bills July 5.

The 233-228 vote, which followed strident lobbying by Prime Minister Junichiro Koizumi's Cabinet, was a crucial victory for the premier, who had made the reform the centerpiece of his government since winning re-election last year.

The postal service controls ¥330 trillion in savings and insurance deposits, and reform proponents say privatization would make more efficient use of those funds for investment.

Passage by the Lower House sends the bills to the Upper House. But even rejection by the Upper House would not block the legislation, since the Lower House can override that with a second vote.

Heizo Takenaka

"We still have a long way," said postal privatization minister Heizo Takenaka. "I will continue my best for the passage of the bills."

The vote, which followed a sometimes raucous debate, came amid fierce infighting within Koizumi's governing Liberal-Democratic Party, pitting calls for reform to streamline the financial system against fears that privatization will reduce jobs and services.

The bills were opposed by many of the country's 400,000 postal system employees, a powerful lobbying group. Some 3,000 workers, fearing that privatization threatens their jobs, protested against the plan July 4 in downtown Tokyo.

The closeness of the vote illustrated how divisive the legislation was. Opponents accused Koizumi of ramming the bills through the Diet.

The Japan Times Weekly: July 9, 2005
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