No.24,Jul.1998

Struggle against the Attempts to Divide and "Reorganize" the NTT with the Aim of Advancing into International Telecommunications

By Takashi Iwasaki

1. Cutting down Info-Communication　Service, and Enforcing Major Restructuring for Thirteen Years since the Privatization of the NTT
   
   Thirteen years have passed since they privatized the state-run enterprise, the Nippon Telephone and Telegram Public Corporation. It was on April 1, 1985 when the new Nippon Telephone and Telegram Corporation, or NTT started. Japanese business circles, major companies and government accomplished their four goals by privatizing the Public Corporation.
   
   First, the Japanese government converted the corporation's assets, which are the people's property, into stocks, and sold one third of them, thus achieving　to earn ten trillion yens.
   Secondly, they set up a system that enabled big enterprises to use telecommunications with more frequency, speediness and convenience but less expensively.
   Thirdly, they made an enormous profit by entering into only the areas of telecommunication business where major companies could accrue gains.
   Fourthly, to achieve the above-mentioned goals, they imposed sacrifice and burden upon public users and NTT workers.
   
   This has resulted in big companies with a huge profit on one hand, and common people burdened with increased tariffs and reduced service. Major enterprises have benefitted from sharp reduction in communication expenses. The NTT reduced the charge available to leased wires to a third level. It introduced a declining bloc rate system. The big companies as major users have also gained an immense profit by entering into the info-communication business; by liking into the NTT's intra city line network, they benefitted from "free basic tariff" charge for using the wires, though public users pay the tariff.
   
   In contrast with this, common users have had to accept drawbacks from the increase of local call charges, sharp rise (three times) in public telepho ne tariffs, higher basic tariffs, abolition of free service for telephone number information and the subsequent increase of the charge carried out twice, hike in telegram fees, increased charge for installing telephones, closure of town telephone offices, and the abolition of night delivery of telegrams.
   
   Telecommunication workers were also forced to accept concession. The NTT cut 169,000 workers, reducing its workforce from 314,000 (as of April 1985 at the time of its privatization) to 145,000 (as of the end of March 1998.) This has resulted in the NTT's workplaces in the long and intense labor, long commuting time, workers' living alone away from home for job assignment, consigning and outsourcing of NTT business, and rapid increase of part-time workers. It is in this context that the number of labor accidents, workers' death or suicides while being in office have increased, with workers' health conditions becoming more deteriorated.
   
   Our union is composed of employees of the Nippon Telegraph and Telephone Corporation (NTT.) The name is the Telecommunication workers' Union (Tsushin Roso) and it is one of the several trade unions in the NTT. It is belonging to the National Confederation of Trade Unions (Zenroren) that is Japan's class-based national trade union center. The Tsushin Roso took up the struggle to guarantee the telecommunications character as for the public benefit, particularly about universal service, and to oppose the restructuring carried out by the NTT. Through this struggle, workers succeeded in getting the company to give up the plan to abolish the night telephone number information service from 10:00 p.m. to 8:00 a.m.
   The NTT's biggest trade union is the Japan Telecommunication Workers' Union (Zendentsu) that affiliates Japanese Trade Union Confederation (Rengo) and has actively supported the NTT's plans of restructuring and reducing the service, thus helped the company make enormous profits and carry out workforce reduction. Such an attitude has raised a severe criticism between the people and workers against the union.
   
   By carrying out the above restructuring and reduction in service for the public, the NTT has gained huge profit. The accumulated hidden profits, namely, internal reserve, amounts to 5.9204 trillion yens, which is equivalent to the national budget of the Republic of Korea. It is also equivalent to 40.7 3 million yens per capita of NTT workers. The NTT's annual profit exceeds 310 billion yens. It is indeed the biggest company in Japan.
   
   
2. Division and "Reorganization" of the NTT will Influence the Way Japanese Industries and Labor Movement Should Be in the 21st Century
   
   The present NTT is to be divided into three companies in July 1999.
   The plan is to set up an international long-distance communication company and two regional (East and West) companies under a genuine holding company. The division and "reorganization" of the NTT have posed a serious question on the companies' running forms and employment in the 21st century. This is because it will open the way for lifting the ban on holding companies, and will have influence on the three forms of employment in the Japanese-style management, that is, regular workers, termed contract workers and part-time workers, described in the financial circles' strategy for the 21st Century.
   
   By revealing the danger of this plan, being in solidarity with NTT-related workers and public users, we are strengthening the movement for securing the public benefit character of telecommunication, and for the improvement of employment and working conditions of employees working in the NTT and related companies.
   
   (1) The division of the NTT according to the holding company system aims at complete privatization of the NTT, abandoning the public benefit character of telecommunication.
   
   After the World War II, the Antimonopoly Law banned genuine holding companies. The Law was established as part of the dissolution of zaibatsu, large capital enterprises of Japan in the prewar period. This also intended to prevent "concentration of power to control the business activities" of group companies. Nevertheless, with the division of the NTT as a precedent, the government lifted the ban on December 17, 1997.
   
   It was the business circles who rejoiced at the lifting of the ban on holding companies. They considered a holding company as an "organizational form of the company efficient for promoting reconstruction of the business through restructuring, spinning-out of the company and diversification of business, while dealing with the ongoing economic and social changes." Now that they allow the holding companies as legitimate, they can pursue further reduction of the cost through drastic restructuring and strengthen their competitiveness.
   
   This shows that the holding companies will only pump up the profits by controlling all the affiliated companies, but will not take any responsibility whatever happen to employment and labor conditions.
   Such a position involves a serious problem that the holding companies will control all their subsidiary companies, but would not have "labor-management relations with workers and unions of subsidiary companies," on the ground that they "do not make labor contracts" with workers of subsidiary companies.
   
   The NTT holding company will own the whole stocks of the three companies that will be set up through the division of the NTT, and it will have the power to control the whole NTT group. There is no doubt that it will oblige the subsidiary companies that cannot gain profits to carry out "restructuring and reduction of labor conditions." It will also lead to regional differences in terms of info-communication service.
   
   (2) Division and "Reorganization" Aim to Facilitate Japan's Multinationals to Advance in the International Market in the Interests of their World Strategy.
   
   Now the United States is taking the lead in the industrial reorganization centered on the telecommunication industry carried forward at high speed all over the world. The AT&T and other globally powerful enterprises are influencing the US government to press other countries to start deregulation, aiming to achieve the establishment and control of a global network.
   
   Japan's financial circles and government act in concert with this move to push deregulation in the info-communication industry, so that the NTT can advance in the international market. The NTT aims to make inroads into the world telecommunication market, by strengthening its international competitiveness "with profits gained by telephone service."
   
   So-called "grand competition" in the world telecommunication market represents a competition in which the world's five biggest telecommunication companies contend with each other for the advantage in "building a network for the benefit of transnational companies," which are estimated at some thousands all over the world. The NTT's internal reserve totaling more than 5.9204 trillion yens is expected to be the capital for it. The biggest aim of the NTT's division and "reorganization" is to allow the NTT to participate in this "grand competition" using its capital.
   
   
3. The NTT Intends for Further Reduction of Workforce and Labor Conditions before its Division.
   
   The NTT has not only cut 37,000 workers in the past year but plans further personnel reduction. The present number of NTT workers totals to 145,000, with some 70,000 being sent on loan to subsidiary companies and 5,900 living away from home for their assignment (4 percent of NTT employees.) Many NTT workers spend more than one hour in commuting.
   
   Such a large-scale personnel reduction is nothing but a tool of the employment style of the "Japanese-style management in the new era" put forward by the financial circles. What they do is to source out the information service for telephone number and transfer 9,000 telephone operators to other sections of completely different job content, substituting them with part-time workers to be engaged in the information service for telephone number.
   
   The NTT authorities also urge the workers to transfer leaving their family, commute long distance or quit their jobs, with pushing on with the streamlining of telephone offices over a wide area. While, by introducing what they call "voluntary retirement system" (with extra allowances) for the workers at the age between forty-five and fifty-seven, they are pressing harder than ever them to choose early retirement.
   
   All these have resulted in twenty-five suicides of workers from overwork in a year.
   
   
4. Unity between the Public Users' Demands and Workers' Demands will Open Perspectives for Our Struggle
   
   We are fighting against the NTT's outrageous plan of cutting down 50,000 workers and dividing and "reorganizing" the company, based on the two principles:
   
   One is to defend the public benefit character of the info-communication　service,　which has become one of the lifelines for the public users. We call for securing universal service equipment such as fixed telephones, public telephones, emergency telephones and welfare telephones, along with the telecommunication service available all over the country with low charges. To defend the sovereignty of communication, we demand a unitary management and operation throughout the country.
   
   The other is to win employment and improved working conditions for the employees of the NTT and its related companies. We uphold the job security along with the maintaining and improvement of the present labor conditions (seven and half hour day) for 220,000 workers of the NTT and its affiliated companies.
   
   Focused on these two principles, we are trying to develop our struggle into a grand struggle, by uniting workers at workplaces despite their affiliation and achieving the advancement of united movements with people of all strata.

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   Takashi Iwasaki is chairperson of the Executive Committee of the Telecommunication Workers' Union in Japan.

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Symposium for Finding a Way Out of Depression Held in Hokkaido

By Katsumi Kataoka

Researchers belonging to Rodo-Soken (the Japan Research Institute of　Labor　Movement) cosponsored the Third Local Policy Study Meeting with trade union　activists of Zenroren (the National Confederation of Trade Unions) last October in Sapporo City, Hokkaido. In the meeting they held a symposium under the title, "To Defend Employment and Life, and to Think about Local Economy."

The reason the meeting took place in Hokkaido was that Hokkaido is among the most seriously affected place by the critical situation facing the Japanese economy.

Hokkaido is one of the four main islands in the Japanese Archipelago, at a northernmost tip of the country. Its area covers 83,452 square kilometers and its population totals 5.6 million, which means the number of people that accounts for about 5 percent of the country's total population living in the 22 percent of the total land area. That is, Hokkaido is the least densely populated region in Japan. With a vast area still left unexplored, Hokkaido is gifted with an extraordinary rich natural environment, which makes the region popular as good place for sightseeing.

Placed the north, Hokkaido is the coldest region in Japan with a heavy snowfall in winter. This gives Hokkaido a peculiar employment problem. Some 130,000 workers employed in the construction industry lose job in winter, because they live in a cold, snowy area. These people are called "seasonal laborers."

Because of no job for them in winter, the Japanese government has set up a special aid system for these workers to pay them unemployment benefits, with which they manage to live through the winter season. However, since this system functions according to how many days the worker has worked in summer, many seasonal workers, who cannot fulfill this condition, are now facing the critical situation in which they are not sure whether they can receive the benefits or not this year.

The meeting had a detailed report on such a reality, which attracted participants' attention.

Hokkaido's especially critical economic situation, is shown in such data as the unemployment rate continuing to break the worst record; job placement office being able to provide only one out of three applicants, with the ratio of effective job offers to job seekers remaining at the level of 30 percent; and the debt amount due to company's bankruptcy totaling five times as large as previous year's level.

The original cause of the grave economic crisis facing Japan dates back to the beginning of 1990's, when the so-called bubble economy started to collapse. The crisis has gone aggravated more directly by the extra burden imposed upon the people through the consumption tax rate increase and change of the medical insurance system the Japanese government pushed ahead last year.

Moreover, the failure of one of Japan's major banks, the Hokkaido Takushoku Bank, in November last year has greatly affected Hokkaido's economic situation. The Bank has been the center of Hokkaido's development and economy as ranked tenth among Japanese banks. It went bankrupt as the result of its reckless business activity it had been engaged in since the beginning of 1990's. The number of Hokkaido's workers dismissed since November last year totals about 44,000, as far as the statistics shows. The number of dismissed workers is 40 percent up compared to that number during the previous year.

The employment situation of high school students who are supposed to graduate this coming spring indicates the worst ever figure in history. The job offering ratio to job seekers remains as low as 0.36, which means only 6,000 jobs are offered to 16,000 applicants.

In the meeting, the participants carried out an earnest discussion searching for a way out of such a difficult situation, and they made a proposal under the title: "Four Changes Needed to Overcome the Economic Crisis of Hokkaido."

First, in order to give solution to unemployment, which is a pressing demand, they demanded based on the "Urgent Employment Policy" proposed by Zenroren (National Confederation of Trade Unions) that the government should take urgent measures to deal with unemployment. They called to the government to set up undertakings that will absorb the jobless workers, improve the job security by such measures as prolonged payment of unemployment benefits, give assistance to unemployed families, create of job by shortening working hours, etc.

Secondly, they proposed reconstruction of the key industries such as agriculture, forestry and fishery, which have sustained Hokkaido's economy.

Agriculture, forestry and fishery in Hokkaido are of especially high position among those of other prefectures in Japan. Taking agriculture as example, the arable land of Hokkaido accounts for 23.4 percent of the nation's total arable land, and Hokkaido holds the biggest share in the country's whole production of beet (100 percent), adzuki beans, potatoes, wheat and milk. However, the successive Japanese governments have taken the policy to undermine these key industries. Hokkaido had 90,000 families engaged in agriculture during 1960's, but the number has declined to 40 percent of that level. Hokkaido's agricultural production, which used to account for 10 percent of the total, has fallen to as low as 4 percent today.

Now, Japan's food self-sufficiency rate is no more than 42 percent. It means that the country can only feed 50 million out of the total population of 120 million, and it depends upon the import from abroad to make up for the deficiency. This presents a sharp contrast with what European countries are doing. They are trying to increase their food self-sufficiency rate.

What has happened to agriculture is common to Hokkaido's fishing, forestry and coal industries. Hokkaido used to have 155 coal mines, but only one is left now and the prospect of its survival is quite poor.

Under such circumstances, they should promote reconstruction of Hokkaido's economy in the direction of restoring its key industries and making Hokkaido into "Japan's food base." To this end, the meeting proposed to secure the price agriculture and livestock products including rice, Japan's staple food, by the level of European countries. It also suggested that the safeguard clause should be exercised as every nation's right against excessive import.

Third is to change the Liberal Democratic Party government's policy as regards the public work projects. The government has promoted over many years investment in public work centered on large-scale projects to serve the interests of major companies, but such a policy needs to be changed into one that gives priority to people's livelihood and welfare.

In Japan, "upside-down politics" is prevailing, in which 50 trillion yens they allocate a year to public work projects that benefit the major general construction companies while they allocate 20 trillion yens to social security . In Hokkaido, the ratio of this imbalance is still higher, and they invest in public works three times as much as they spend in social security.

The most extreme case of such imbalances is the construction project of an industrial base in the eastern Tomakomai. The plan was made in the early 1970's to set up an industrial base, where 50,000 people would be employed to achieve an annual production of 3,300 billion yens. However, due to little progress in inviting factories, they have only managed to sell 15 percent of the planned area, employ 1,600 workers, which are 3.2 percent of the planned figures, achieved 3.6 percent of the planned production sum. As a result, enormous debt is left and discord has arisen among the central government, local government and private companies over the payment of the debt.

Obviously, as this case shows, large-scale projects they have carried while destroying Hokkaido's key industries are not effective in overcoming the great depression facing Hokkaido today. It is necessary now to invest the state's funds instead into those projects that can serve the people's living, for example, in such areas Japan remains far behind as the construction of welfare facilities for the aged people, construction of roads for the benefit of people's living or environmental protection. Official calculations by local governments also make it clear that such investment can secure the job for small- and medium-sized enterprises and expand employment.

The meeting proposed from this point of view that a traffic network for people's daily use be constructed, and that small- and medium-sized enterprises in the localities should undertake the construction and maintenance of life infrastructure including medical, welfare, and education service.

Forth and lastly, they should take measures to protect small- and medium-sized enterprises and stores from the storm of bankruptcy.

Just like other places in Japan, 99 percent of Hokkaido's 275,000 establishments are small- and medium-sized companies with 300 or fewer workers. These companies employ 83 percent of the whole workers. Banks have suspended or withdrawn half-forcibly lending due to the failure of the Hokkaido Takushoku Bank and government's financial policies. This has driven small- and medium-sized enterprises into an extremely difficult situation, and the number of suicides is increasing.

"Deregulation" carried forward by the government has made it easy for large- scale retail stores to advance, and accordingly small stores have been obliged one after another to close their business. The local shopping areas are collapsing. Yubari City used to be a town of coal mines but due to the withdrawal of coal mining companies, the number of stores has decreased for the past twenty-five years from 860 to 364. They now call the former shopping area "a shuttered street," because every store remains closed and shuttered.

It is dispensable for the reconstruction of Hokkaido's economy to restrict the advancement of large-scale stores and take measures for the revival of small- and medium-sized enterprises.

Zenroren has already launched a struggle according to the conclusion of the meeting. The Japanese government with the support from some opposition parties has pushed ahead with an exorbitant use of the state fund. It completely ignored the people's demand for the reduction of a consumption tax rate, and forced through the investment of 60 trillion yen tax moneys to bail out major banks. Now it faces the great indignation of the people. Zenroren is striving to build up a national struggle for getting a breakthrough in the present recession in the direction to serve the people's interests.

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　　　Katsumi Kataoka is Head of Research and Policy Study Section, Hokkaido Confederation of Trade Unions.