Chapter 3 JR Group's New Developments and Tasks Remaining
After JNR Reform
3. 1 JR Group's New Developments
As for the settlement of accounts of the JR group for fiscal 1987, which was
inaugurated on April, 1987, the seven companies recorded a total of \151.5 billion
in ordinary profit and \50 billion in current-term profit. These figures indicate
that the JR business went generally smoothly for an initial year. The main reason
is that, in addition to their management improvement efforts, such as increased
earnings and cost reductions, the transport volume increased on the strength of
a business recovery and other factors.
In fiscal 1988, the JR companies carried out business operations in a positive
way. Although it is difficult to draw a hasty conclusion about the result, it
is believed that the JR business has gone generally smoothly as far as their handling
revenues are concerned. (Table 4)
3. 2 Tasks Remaining After JNR Reform
The settlement of the JNR long-term debt to be made by the JNR Settlement
Corporation, the re-employment of former JNR employees and the JNR pension problem
are the most important tasks remaining after the JNR reform, and we have to
tackle these tasks in a positive way.
As for the settlement of the long-term debt, the Corporation is carrying
out the business of disposing former JNR assets, giving consideration to various
land price curbing measures, in accordance with the basic repayment policy decided
by the Cabinet in January, 1988. Since land-sale tenders were postponed in some
areas where land prices were rising at an unusual pace, the land sale in fiscal
1987 was about half the amount originally scheduled.
The settlement of accounts for fiscal 1987 shows that, although the Corporation
endeavored to secure financial resources of its own, the long-term debt rose
to \20.4 trillion at the end of the fiscal year from \18.1 trillion at the beginning
of the fiscal year; the debt to be settled, including pension and other burdens
to be borne in the future, rose to \26.2 trillion at the end of the fical year
from \25.6 trillion at the beginning of the fiscal year.
The re-employment of former JNR employees has been carried out in accordance
with the re-employment promotion basic plan decided by the Cabinet in June,
1987; the number of those unable to find a new job totaled 7,628 as of April
1, 1987, which dropped to 4,292 as of November 1, 1988.
3. 3 Review of JNR Reform
(1) As for passenger transport, the volume increased 3.6% from the previous fiscal
year, including increases in Hokkaido. Shikoku and Kyushu where passenger transport
had shown a trend of decrease. As for freight transport, the volume was about
the same as the previous year on a ton-kilometer basis; in sum, the business went
generally smoothly. (Table 5)
(2) According to the settlement of accounts, the seven JR companies and others
recorded a total of about \160 billion in current-term profit. The JNR Settlement
Corporation recorded a de facto loss of about \1,170 billion, excluding the loss
amounting to the debt which the Corporation had succeeded from the Japanese Railway
Construction Public Corporation. Therefore, the overall profit-loss situation
in fiscal 1987 resulted in a loss of about \1,010 billion, an improvement of about
\350 billion over the pure loss of about \1,360 billion reckoned up in the JNR
settlement of accounts for fiscal 1986.
(3) As for the JR group's long-term debts, the JR companies and the Shinkansen
Holding Corporation saw a decrease of about \400 billion and about \100 billion,
respectively, and the JNR Settlement Corporation saw an increase of about \2.3
trillion, at the end of fiscal 1987, compared with the figures at the beginning
of the fiscal year.
