Japan opposition threatens to censure minister

BY Teruaki Ueno

TOKYO (Reuters) - Japan's main opposition party stepped up its attack on Prime Minister Yasuo Fukuda's government on Tuesday, threatening a rare censure motion against the health minister in parliament's upper house.

Fukuda is struggling with a policy deadlock in a divided parliament, prompting speculation his ruling party might replace him ahead of an election that could come this year.

The Democratic Party, which with small allies controls the upper house and can delay laws, has already blocked the extension of an unpopular gasoline tax that expired on Monday, prompting petrol stations to start cutting prices by 25 yen (25 cents) per liter, or around 17 percent. It has also vetoed two government nominees for central bank governor.

Now the Democrats are turning the focus back to pension problems, a topic that helped the opposition win control of the upper house in an election last year and eventually oust Fukuda's predecessor.

Charging the government with failure to keep its pledge to clean up botched public pension payments by the end of March, Democratic Party leader Ichiro Ozawa told a news conference that Health Minister Yoichi Masuzoe should apologize and "take responsibility" --- political code in Japan for resigning.

If Masuzoe did not step down, the Democrats would consider submitting a censure motion against him in the upper house, where it would likely pass with opposition support.

Censure motions are non-binding but the embarrassment has forced a cabinet minister to resign in the past.

"If the government and ruling parties do not admit their mistakes and broken promises, and continue to put off a solution to the problem, they should quickly hand over power and entrust the resolution ... to the Democratic Party," Ozawa said.

Officials confessed last year to misplacing millions of pension records, sparking public outrage and concern that retirees would be short-changed.

The government had vowed to sort out the pension mess by March 31, but the holders of about 20 million pension accounts remained unidentified.

Ozawa said voter dissatisfaction over the pension issue and the gasoline tax could prompt the public to push for early general elections, which are not due till September next year.

"In this context, I believe the lower house could be dissolved early and we must be prepared for that," he said.

The ruling bloc is wary of a poll that would almost certainly see it lose seats but some pundits say the prime minister may be forced to seek a mandate to try to resolve the paralysis.

(Reporting by Chisa Fujioka and Teruaki Ueno; Editing by Hugh Lawson)