By Linda Sieg
TOKYO (Reuters) - Pressure mounted on Sunday for unpopular Prime Minister Naoto Kan to step down soon and even a senior member of his own party warned the lameduck leader not to stay in office much longer.
Kan's early departure would ease the way for a coalition with the opposition that could enact a bill enabling the government to issue more debt to fund this year's $1 trillion budget and pass an extra budget to pay for rebuilding the region devastated by a March 11 earthquake and tsunami.
But it is far from clear whether a temporary and likely unwieldy grouping could tackle longer term problems such as Japan's massive public debt, already twice the $5 trillion economy.
"He (Kan) has clearly said he will resign ... so it is now up to the prime minister to decide (the timing)," DPJ Secretary-General Katsuya Okada said.
"If that is very different from what most people think, I intend, as secretary general, to tell him to quit."
Kan survived Thursday's no-confidence motion in parliament after telling rebels in the ruling party he would step down but that he needed more time to try to deal with the most pressing problems facing Japan, especially the nuclear crisis following the massive March tsunami.
But no sooner had he survived the vote than Kan hinted he would stay in office into the new year, infuriating many in his Democratic Party of Japan (DPJ) who had assumed the country's fifth prime minister in five rears would quit much sooner.
The opposition, which controls parliament's upper house and can block bills, is refusing to cooperate with the government in enacting key legislation.
"We want the prime minister to resign as soon as possible in order to create a new framework quickly," Nobuteru Ishihara, secretary-general of the main opposition Liberal Democratic Party (LDP) said in a debate on NHK public TV.
He said that Kan should step down this month.
Kan is struggling to contain a nuclear crisis at Tokyo Electric Power Co's Fukushima plant, find ways to pay for Japan's biggest reconstruction project since the end of World War Two and craft tax and social security reforms to rein in debt in the fast-aging society.
Okada urged the opposition to join talks on drafting the reconstruction budget, but Ishihara said doing deals with a lame-duck leader made no sense.
"The prime minister who drafts a budget cannot be different from the one who implements it," he told another TV talk show.
Among possible contenders to replace Kan are Finance Minister Yoshihiko Noda, a fiscal hawk; Deputy Chief Cabinet Secretary Yoshito Sengoku, who has advocated a coalition with the LDP to break the parliamentary logjam, and former foreign minister Seiji Maehara, who on Sunday echoed that stance.
Okada, the No.2 in the Democratic Party line-up, said a temporary coalition would be needed to implement policies given that the hung parliament, in which one camp controls the upper house and a rival block has a majority in the lower chamber, might continue until the next upper house election in 2013.
"Even if we have a snap election, there will be no change in the fact that neither our party nor the LDP and New Komeito have a majority in the upper house. In that sense, unless we have something like a 'grand coalition' for some period of time, nothing will get done. I think all politicians understand that."
Ishihara echoed that view, but suggested any coalition would be a "prelude" to a realignment of the parties along more consistent policy lines. Some experts have long advocated such a rejig, arguing the main parties' policy diversity is an obstacle to resolving challenges facing Japan's fast-aging population.
"The next several months or half a year would be 'prelude'," he said. "Then if relations of trust are created and we are in a situation where we can hold a general election, we could seek a popular mandate and create a trustworthy new framework."
Kan had asked LDP President Sadakazu Tanigaki to join his cabinet soon after the March disasters struck, but Tanigaki rejected the offer as "too sudden."
(Editing by Jonathan Thatcher)