The government intends to improve legal measures for dealing with the possible failure of public corporations, Nobuteru Ishihara, minister in charge of administrative and regulatory reforms, said Sunday.

Ishihara made the remarks on a TV talk show in connection with growing calls to liquidate the heavily indebted Honshu-Shikoku Bridge Authority. It operates three bridges and toll roads linking two of Japan's four main islands.

Discussing the current law's inadequacy, Ishihara said: "Even if the authority is abolished, the bridges will continue to exist . . . while debts also remain. But there is no rule on what to do when interest-bearing debts become non-repayable."

Ishihara said the "most essential" part of discussions on privatizing or liquidating public entities is to "determine where the debts could really be repaid and how they should be repaid."

But he brushed off the idea of any immediate plan to end the bridge authority because "a great many problems remain," such as repayment of debt principle and the transfer of bridging technologies.

The authority had some 3.8 trillion yen in interest-bearing debts outstanding as of last March 31, with annual interest payments reaching 140 billion yen against toll revenues of some 90 billion yen.

The government is set to compile reform plans for each public corporation by the end of August under Prime Minister Junichiro Koizumi's orders to Ishihara to reorganize such entities.

The plan is expected to include which entities to maintain, merge, privatize or liquidate.