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The Japanese National Railways fell into red in fiscal 1964. Since then,
its management kept declining. Various reconstruction measures were promoted
twice (in fiscal 1969 and in fiscal 1973) to recover its financial soundness.
However, these reconstruction measures failed to accomplish targets structually
because of the changes in transport Structure resulting from energy revolution
and the change of industrial structure etc. and directly because of the fare
income held in check due to delayed fare revisions etc. and cost rise due to
rapidly rising personnel expenses and commodity expenses etc.
As a result, the deficits amounted to 910 billion yen in the fiscal year
of 1975. The cumulative deficits reached 3,160 billion yen and the balance of
long-term liabilities amounted to 6,780 billion yen.
The financial difficulties of the Japanese National Railways can be accounted
mainly by the following factors.
| (1) | Fare The fare standards of the Japanese National Railways have been kept as low as possible from the standpoint of the commodity price policy. The fare standards were too low to obtain necessary income. Adequate and timely fare revisions are necessary for maintaining sound management. Proposals have been made to give more flexibility to the current legal system. For this reason, the current fare revision method is to be restudied. |
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| (2) | Provincial Lines The management of so-called provincial lines has been faced with serious difficulties because of annually decreasing transport volume which is accounted by the progress of motorization and depopulation under rapid economic growth. The problems of provincial lines should be studied fully for gaining national consensus. |
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| (3) | Cargo Transport share of railways has been decreased to only about 13% of the total cargo transport volume in fiscal 1975. This is attributable to the energy revolution and the change of industrial structure in progress since 1960s, as well as to the rapid advancement of trucks and the rapid development of see-side industrial zones. In addition, recently, shippers tend to distrust the Japanese National Railways because of their frequent strikes etc. and moreover, personnel expenses and other expenses increased sharply, partly because of the delay of ration alization. As a result, the deficits in the cargo division kept rising every year and acount for a considerable part of the total deficits of the National Railways. ln the future, it will be required to promote reorganization and improvement of their cargo transport system in the field of direct transport and other fields where the features of the rail way cargo transport can well be displayed. |
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| (4) | Rationalization The National Railways has attempted to rationalize the management. However, their worker reduction between the fiscal years of 1969 and 1975 was only about 44 thousand persons because additional employments had to be made for the extension of the new trunk lines etc. The worker reduction is far behind the reduction plan under the financial reconstruction plan beginning in fiscal 1973 too. The rationalization will require not only the improvement of facilities and the modernization of transport systems, but also the complete study for efficient operation in the cargo division. |
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