Japan PM brushes aside talk of cabinet reshuffle

TOKYO (Reuters) - Japanese Prime Minister Yasuo Fukuda brushed aside speculation on Friday that he would reshuffle his cabinet this month to boost his flagging popularity, saying he wants to keep his current cabinet members in their posts.

Japanese media have reported that Fukuda, who took office last September after predecessor Shinzo Abe resigned and kept on most of Abe's ministers, was considering reshuffling his cabinet in mid-January.

"Taking various things into consideration, I'd like the current cabinet ministers to continue their work," Fukuda told a news conference.

Fukuda's support has fallen below 35 percent in recent voter polls from an initial high of 60 percent, battered a string of headaches including a Defense Ministry procurement scandal and government mishandling of millions of public pension records.

In his first news conference of the new year, the 71-year-old Fukuda also apologized twice -- once over the botched pension records and again to patients who contracted hepatitis C through tainted blood products from around 1970 to the early 1990s.

"Not only the bureaucracy but the politicians who supervise them also have a big responsibility, and as a politician I would like to apologize frankly," Fukuda said about the pension mess, adding that his government would strive to create a pension system that people could trust.

Fukuda's government faces a tough struggle this year to enact legislation in parliament, where opposition parties control the upper house and can delay legislation.

Japanese politics was thrown into turmoil last year when the leader of the main opposition Democratic Party, Ichiro Ozawa, discussed a coalition with Fukuda then tendered his resignation when his party executives rejected the idea.

Ozawa changed his mind and decided to stay in his top party post, vowing to topple the government in an election many think could come this year.

Asked if he still favored a "grand coalition" between his Liberal Democratic Party (LDP) and the Democrats, Fukuda said the goal was to implement policies, and to achieve this it was necessary to have frequent talks with the Democratic Party.

The first clash of the new year could come next week, when the opposition-controlled upper house is expected to vote down a government-sponsored bill that would allow Japan's navy to resume refueling of U.S. and other ships patrolling the Indian Ocean for suspected terrorists and drug smugglers.

Washington has said the naval mission, which was halted last year when enabling legislation expired, is vital to the global war on terrorism and Fukuda has vowed to enact the law.

The ruling bloc can use its two-thirds majority in the more powerful lower house to override an upper house rejection, but the rarely used tactic risks sparking a public backlash.

(Reporting by Linda Sieg and Yoko Nishikawa, Editing by Michael Watson)