By Linda Sieg and Yoko Kubota
TOKYO (Reuters) - Japanese Foreign Minister Seiji Maehara resigned on Sunday to take responsibility for accepting donations from a foreign national, adding to unpopular Prime Minister Naoto Kan's troubles as he battles to keep his own job.
Maehara, a security hawk who favors close ties with the United States and has criticized China's defense build-up, had been seen as a key contender to succeed Kan if the prime minister bows to pressure to step down himself.
Maehara's resignation deepens the impression of a government in disarray as Kan fights to keep his own Democratic Party (DPJ) from splintering and avoid calling a snap election while trying to enact budget bills in a deeply divided parliament.
The stalemate is blocking the passage of bills needed to implement a $1 trillion budget for the fiscal year from April, and Maehara said he had feared his scandal would only worsen the deadlock if he clung to his post.
"The budget deliberation in the upper house for fiscal 2011/12, an urgent issue, is at a crucial stage," Maehara told a news conference after meeting Kan. "I cannot let parliamentary deliberations get delayed through my political funding problem."
The political impasse is also keeping Kan from getting opposition help on fiscal reforms, including a rise in the 5 percent sales tax, that he argues are vital to fund the costs of a fast-aging society and curb public debt now twice the size of the $5 trillion economy.
Kan, whose voter ratings have slid to around 20 percent, himself faces calls from within his own fractious party to resign, while opposition parties are pushing him to call a snap election that the Democrats could well lose.
His health minister, Ritsuo Hosokawa, is also under fire for the government's messy handling of efforts to help housewives who mistakenly failed to pay their pension premiums.
Although Maehara's resignation is bad news for Kan, it may not necessarily hasten his exit. "It's impossible for him to call a snap election. Momentum will build for Kan to resign," said Nihon University political science professor Tomoaki Iwai.
Iwai added, however, that Kan was unlikely to quit without assurances from opposition parties that they would help enact the stalled budget bills, something they might well be unwilling to provide, especially ahead of nationwide local elections in April.
HOTSEAT GETS HOTTER
Opposition parties were quick to turn up the heat on Kan.
"We will take issue with the prime minister's responsibility in having appointed him (Maehara)," Kyodo news agency quoted main opposition Liberal Democratic Party (LDP) policy chief Shigeru Ishiba as saying after reports that Maehara wanted to quit.
Kyodo added that the LDP would step up its push for an election for parliament's powerful lower house, a poll that the ruling Democratic Party is in danger of losing if held soon.
The second-biggest opposition party, the New Komeito, echoed the criticism.
"The Kan government has lost the confidence of the people. There can only be a resignation of the entire cabinet or a dissolution of the lower house," New Komeito leader Natsuo Yamaguchi was quoted as saying by Kyodo news agency.
An election, however, would not resolve the problem of a divided parliament since no single party would hold a majority in both houses, no matter who wins.
Maehara had admitted on Friday accepting donations from a Korean resident of Japan, but said he had done so unknowingly. Taking political donations from foreign nationals is illegal if done intentionally. On Sunday, Maehara said he had received a total of 250,000 yen ($3,000) from the donor between 2005 and 2010.
(Additional reporting by Kiyoshi Takenaka, Chisa Fujioka and Shinichi Saoshiro; Editing by Joseph Radford and John Chalmers)