TOKYO - Japanese Prime Minister Naoto Kan will have to reshuffle his cabinet before the legislature opens this month, a ruling party official said on Sunday, in the clearest signal yet of a shake-up aimed at improving the government's approval ratings.

Japanese media said the reshuffle could take place on Jan 17 and Kan may remove Chief Cabinet Secretary Yoshito Sengoku following his censure in the upper house over handling of fraying ties with China last year.

The move to remove Sengoku, who is the de facto No 2 in the government, could placate the opposition and help clear the passage of bills in a divided parliament.

"We will open the parliament session sometime between Jan 21 and 28. A cabinet reshuffle would be necessary before that," Katsuya Okada, the Secretary General of the ruling Democratic Party of Japan (DPJ) said on public broadcaster NHK.

Hurdles remain high for Kan as he tries to enact the budget for the year from April, tackle tax reform, improve sagging ratings and quieten a fractious DPJ.

The upper house passed non-binding but embarrassing censure motions against Sengoku and the transport minister in November over their handling of a territorial row with China.

The two biggest opposition parties, the Liberal Democratic Party (LDP) and the New Komeito, said they would boycott parliamentary business if the two stayed on.

Kan is considering replacing Sengoku with Finance Minister Yoshihiko Noda, Kyodo news agency reported. The DPJ's Deputy Secretary General Yukio Edano was another possibility for the job, the Nikkei newspaper reported.

Okada declined to comment on details of the reshuffle.

The LDP and the New Komeito maintained their confrontational stance on other fronts, saying the government should present its own plan on social security and tax reforms including the sales tax before they could respond to calls for multi-party talks.

Japan's public debt is already about twice the size of its $5 trillion economy and private economists agree that raising the sales tax will be essential to cope with the rising costs of a fast-ageing society.

In order to pass bills needed to implement the 2011-12 budget, Kan must either cobble together a simple majority in the upper house with opposition help or build a two-thirds majority in the lower house to override the upper chamber.

Okada said that he wants to avoid using the option of overriding votes in the lower house and repeated that the government is willing to revise the budget. He also said that he wants to review the DPJ's manifesto by mid-year. The LDP and New Komeito chiefs suggested that the government needs to revise its plans in the budget to rein in debt.

Kan may be eyeing cooperation with the New Komeito, whose votes would be enough to clear the upper house, to help pass the budget-related bills needed to enact the budget, rather than risk voter ire for delaying spending.

Reuters

(China Daily 01/10/2011 page11)