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In FY1978, JNR suffered a larger deficit than in FY1977, because the increase
in operating expenses exceeded the Increase in its revenues resulting from raises
of fares, rates and charges in July and October 1978 and January 1979.
The operating profits of 14 major private railway companies in FY1978 leveled
off. As a huge revenue shortfall was expected if the situation were left as
it was, they raised their fares - 13 of the companies in January 1979 and the
remaining one in March 1979. Medium- and small-sized private railway companies
operating in the environs of major cities increased their operating revenues
by 11.2% as a result of fare raises. They chalked up enough recurring profits
to more than offset their recurring losses suffered in the preceding fiscal
year.
Railways operated by municipal governments remained in the red in the operating
profits/losses accounts. But, the losses were smaller than in FY1977 as their
operating revenues grew at a much larger rate than their operating expenses
thanks to fare raises. Teito Rapid Transit Authority registered recurring profits
for the second consecutive year since their operating revenues increased by
20.6% through a Increase of their fares in May, 1977, although their operating
expenses rose by 25.1%.
Bus lines, both those run by private companies and those operated by municipal
governments, generally continued in the red. But, the operating revenues of
the lines run by municipal governments increased by 6.5%, compared to the 1.6%
rise in their operating expenses. Cars-for-hire and taxi operators registered
slightly larger recurring profits than in the preceding fiscal year. Trunk-line
trucking business turned into the black in the recurring profits/losses accounts
with operating profits increasing and non-operating losses shrinking. Short-haul
trucking business had larger black-ink figures in both the operating profits/losses
and the recurring profits/losses accounts than in FY1977. The forwarding business
remained in the red although their losses were smaller in the preceding year.
Ocean shipping business improved as it chalked up larger operating profits
and smaller recurring losses than in the preceding fiscal year although both
operating revenues and expenses dropped 14%-1 5%. Operating revenues and expenses
of coastal shipping almost leveled off, both showing an increase of somewhere
between 4% and 5%.
Long-distance ferry business showed very good performance as operating revenues
increased and operating expenses decreased. Operating profits nearly tripled
and the business was in the black in the recurring profits/losses accounts.
Shipbuilding showed a deficit in the operating profits/losses accounts as
operating revenues declined at a higher rate than operating expenses. The recurring
profits/losses accounts, too, were in the red.
Warehousing business leveled off, in general showing no substantial change
from FY1977.
Air transport business showed nearly the same amount of operating profits
as in the preceding fiscal year since both operating revenues and expenses increased
by more than 10%.
The ratio of effective job offers to applications in all industries, which
registered its lowest 0.53 (seasonally adjusted, so also with the following)
in the October-December period of 1977, improved moderately to 0.65 in January-March
period of 1979. The number of jobless workers increased from 1,100,000 in 1977
to 1,240,000 in 1978.
The supply-and-demand situation for seafaring labor still remains rigorous.
The effective job offers to applications ratio for seamen, which registered
its lowest 0.19 in the January-March period of 1976, improved slightly to 0.32
in January-March period of 1979. But, it was still about half the ratio in all
industries.
JNR's business has been deteriorating year after year since it dropped
into the red in FY1964.
In view of the considerable change in the environment related to the JNR
and the need for a flexible system of determining JNR fares, rates and charges,
the Cabinet approved a "Basic Policy for Reconstruction of Japanese National
Railways" on December 29,1977, establishing a basic course to be followed for
JNR's reconstruction. The basic policy clarifies the roles and responsibilities
of the users, the JNR itself and the government in reconstructing the national
railways.
The Transport Minister requested JNR to submit a concrete plan based on this
policy. JNR responded by submitting a "Draft Basic Plan for Rehabilitation of
Japanese National Railways" in July 1979. According to this draft scheme, JNR
aims to achieve an equilibrium in its general net profits and losses in FY1985,
excluding those profits and losses which are associated with new Shinkansen
lines to be opened in future. To this end, the draft basic plan calls for every
possible effort through the 1980s, that is, implementing various measures for
streamlining JNR's business under a priority system and retrenchment of its
work force, coupled with the government's administrative and financial assistance.
The proposed measures include : trying to reduce the work force to 350,000 in
FY1985, making appropriate and timely revisions of fares, rates and charges,
and scaling down construction. The Ministry of Transport will make necessary
changes concerning the concrete measures proposed in this draft basic plan and
decide on concrete actions which the government should take for rehabilitation
of JNR.(Fig. 6)
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