Fri, Dec 25, 2009 - Page 5 News List

Two Hatoyama aides charged over records

HEADACHE Analysts said the indictment was unlikely to force the prime minister to step down, but the scandal will test him and voter support may slip further ahead of elections next year

REUTERS , TOKYO

Two former close aides to Japanese Prime Minister Yukio Hatoyama were charged yesterday over falsified political funding records, Japanese media said, a development that threatens to erode support for the government.

The scandal, which has been public knowledge for months, is thought unlikely to force Hatoyama to resign, but the indictments will be another headache for a government that marked 100 days in office yesterday and faces key decisions on next year’s budget and relocating a US airbase.

A sharp slide in voter approval could endanger the prime minister’s grip on his post ahead of an upper house election in the middle of next year, in which his Democratic Party wants to win an outright majority to reduce the clout of two tiny but vocal coalition partners.

Opinion polls have shown voters are unhappy with Hatoyama’s explanation of the misreported donations, but a ­majority have said he need not resign over the affair.

There is no suspicion of bribery because the funds, amounting to more than ¥300 million (US$3.28 million), were funneled from Hatoyama’s own family fortune, media reports say. The prime minister has said he will pay any taxes that may be due on cash received from his mother.

“Since it is not a corruption case, how Prime Minister Hatoyama handles this incident will be a key test as doubts grow over his leadership, decision-­making ability and crisis management skills,” said Tsuneo Watanabe a senior research fellow at the Tokyo Foundation.

Jiji news agency said one aide was charged and fined ¥300,000 in a summary procedure, while another was indicted at home. Tokyo prosecutors said they could not confirm the report.

The legal proceedings are thought unlikely to cause a quick, sharp drop in Hatoyama’s voter support, which has fallen below 50 percent in some polls from initial highs of more than 70 percent, as doubts grow over his leadership skills.

Jiji news agency said prosecutors decided not to charge Hatoyama himself, but analysts say the indictments are a blow for the prime minister at a vulnerable time.

“The [opposition] Liberal Democratic Party is too weak to force him to resign ... and I don’t think Hatoyama will voluntarily step down either,” said Kyohei Morita, chief economist at Barclays Capital Japan.

He said he expected limited impact on financial markets, “but it may worsen voter support ahead of the upper house election.”

Hatoyama said earlier in the day he would explain more about the funding scandal once prosecutors make decisions. He has repeatedly denied knowing anything about the misreporting.

“The problems will come in parliament next year, when he will be attacked by the Liberal Democratic Party over this,” political commentator Harumi Arima said. “The question is whether he can stand up to that.”

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