Chapter 5 Development of a Rail Transport System Meeting the Needs of the Japanese People

1. Expansion of the Rail Network

The Railway Development Fund was established on October 1, 1991, to provide comprehensive and effective support for railway development. It is aimed at providing balanced development of rail throughout the country and maintaining and extending rail functions in metropolitan areas.
The Fund is financed partially through income from existing Shinkansen lines and from the national General Account. Grants are given for the following sorts of activities:
Grants and non-interest loans (NTT - B) for the construction and equipping of Shinkansen lines
Grants and non-interest loans for activation of principal trunk lines lines and maintenance of the urban railway network
Grants for the Yamanashi experimental linear railways
Grants for small- and medium-sized regional railways
Groundbreaking took place in September 1991 on three new sections of Japan's five Shinkansen routes - Hokkaido, Tohoku (Morioka - Aomori), Hokiruku, Kyushu (Kagoshima Route, Nagasaki Route). In addition to work on the Takasaki - Karuizawa section of the Hokuriku route, work also commenced on the Morioka - Aomori section of the Tohoku route, the Karuizawa - Nagano section of the Hokuriku route, and the Yatsushiro - Nishi Kagoshima section of the Kyushu route.
Effort is being put into the planned and steady development of urban railway networks, such as subway systems, monorail services and new transport systems, in addition to railways of JR and large private railways companies.
These efforts aim at responding effectively to the increasing demand for transport, for appropriate rationalization of the various functions concentrated in city centers, and for ordered development of rail in greater urban areas.
Effort is being put into the maintenance and expansion of lines on small and medium sized railways, which are essential to life in regional areas, through cooperation with local public' bodies.
It is essential for railways shifted from JNR to achieve working profits for funds that have been built up by local public bodies. In addition to this it is essential that further efforts be put into business operation and attracting passengers.

2. Expansion of Rail Transport Services

  In recent years the quality of life of the Japanese people has risen and in line with this demand has increased for greater comfort, convenience and quality in rail services.
Concrete measures are being pursued to satisfy these needs:- further air-conditioning of train carriages, improvements in railway station facilities to increase convenience for all users, including people for whom travel is difficult, and increases in the number of interconnecting rail lines in urban areas. Efforts are also being put into diversification of trains and carriages, the improvement of late night services and providing services that satisfy newly arising needs.

3. To Finishing Touches of JNR Reform

The transport volume of each of the JR companies rose over the previous year in FY1990 due to increased demand supported by favorable expansion in the domestic economy. The combined transport volume of the six JR companies increased 6.1% over the previous year to 233.7 billion passenger kilometers. This is a record figure for the JR, including the time it operated as the Japan National Railways (JNR).
There was steady expansion in the amount of cargo transported with increases 8.1 % over the previous year to 26.7 billion ton kilometers due to the favorable growth in container transport.
Results were also produced from efforts to expand the business basis through active increase of related business. The collective net profit in FY1990 from the six JR companies was 4 trillion 353.8 million yen, an increase of 7.4 percent over the previous year. The three Honshu JR companies distributed profits by paying their first ever dividends (dividend of 10 percent).
In 1991 further efforts are being put into projects including safety policies, increasing transport capacity and expanding user services in order to establish a sound operating basis.
Concerted efforts are being made to deal with the long-term debt of the dissolved JNR at the earliest opportunity. These efforts follow the Cabinet Decisions "Detailed Guideline for Liabilities Repayment of JNR Settlement Corporation" (Cabinet Decision, January 26, 1988) and "Detailed Guideline for Liabilities Repayment of JNR Settlement Corporation" (Cabinet Decision, December 19, 1989) and involve increasing income from the disposal of land and disposing of effective JR stock.
In 1990 there was a large increase in income from the disposal of fixed assets including land. The obligations which would have been borne by the Teito Rapid Transit Authority, a sizable sum, were absorbed in a single transfer into the national General Account by the government at an appropriately adjusted value. Debt decreased as a result of these measures for the first time, and stood at 26.2 trillion yen at the end of 1990.
The necessary constitutional revisions for the disposal of JNR land and the establishment of a system for business debt based on subscribed convertible stock, were undertaken in May 1991.
Also, in September 1991 the Council for the Disposal of Fixed Assets released the "Emergency Proposal Concerning the Disposal of Land Belonging to the Dissolved Japan National Railways" in response to the dramatic environmental changes which have been experienced recently. Revisions made to the system based on this proposal gives scope for more harmonious conditions in private contracts.
"Views on the Disposal of JR Stock" was released as the opinion of a discussion meeting to "Consider Basic Problems Concerning JR Stock". In addition to implementing measures for disposal of stock based on these views, the evolution of events in the securities industry also needs to be observed.
The railway facilities of the four existing Honshu Shinkansen Lines, which was possessed and loaded by the Shinkansen Holding Corporation were transferred in full with loans intact to the three new Honshu JR companies on October 1, 1991, at a value of 9.2 trillion yen. The Shinkansen Holding Corporation which formed the basis of operations was simultaneously dissolved.
JNR Reform is going ahead smoothly from the point of view of income and expenditure. However, the question of long-term dabt and privatization of the JR and a requirement for sound business operation in the future need to be dealt with.

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