The Yomiuri Shimbun
The government is considering establishing an organization for paying compensation to victims of the nuclear accident at Tokyo Electric Power Co.'s Fukushima No. 1 nuclear power plant, according to sources.
Under the scheme, other electric power companies would also be expected to contribute funds to the organization.
The government had earlier reportedly been considering a plan to form a mutual aid system that would be part of a compensation scheme.
The new organization would have two roles: payment of compensation to people affected by the nuclear accident, and establishment of a reserve fund for possible future nuclear accidents.
Special legislation would likely be necessary to establish the organization. The government aims to decide the outline of the scheme by the end of this month.
The new organization would be modeled after the Deposit Insurance Corporation, which provides financial aid in the event of a financial institution going under, the sources said.
The new organization would have two accounts of money reserves. One is a special account for payment of compensation to victims of the nuclear disaster, to which TEPCO will mainly contribute. The other is a general account for compensation for possible future nuclear accidents, which not only TEPCO but also other electric power companies would pay into.
TEPCO would contribute hundreds of billions of yen to the special account from its retained earnings and other sources, and the new organization would give financial aid to TEPCO in the form of government-guaranteed loans from banks.
The new organization would also buy preferred TEPCO shares and the utility would pay back tens of billions of yen annually in the form of dividends for 10 to 15 years.
Under a law covering compensation for nuclear accidents, the government would also contribute 120 billion yen to 240 billion yen to the organization via TEPCO.
If the special account alone could not cover the compensation, the government would provide additional funds. Money in the general account to which electric power companies would contribute would be transferred to the special account for compensation payment under the government's plan.
The government began considering the new organization with a view to subsuming TEPCO's compensation schemes. By doing so, the government aims to avoid the worst-case scenario of electricity supply being interrupted due to TEPCO's financial collapse.
The government also aims to reassure the public concerning the payment of compensation by backing the scheme.
(Apr. 18, 2011)
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