By Noah Barkin
BERLIN (Reuters) - Germany's defense minister defended his handling of a costly drone deal and rejected calls to resign on Wednesday, averting an embarrassing setback for his boss Chancellor Angela Merkel months before an election.
Thomas de Maiziere, Merkel's former chief of staff and perhaps her closest cabinet ally, has come under intense pressure since announcing last month that Germany was cancelling plans to purchase four Euro Hawk reconnaissance drones.
Opposition parties have accused him of withholding information about problems with the project and waiting too long to scrap it, wasting some 680 million euros in taxpayer money.
De Maiziere firmly rejected those allegations and vowed to stay in office, even as he admitted to "major problems" in his ministry and threatened consequences for key staff he said had kept him in the dark about cost issues linked to the drones.
"I am convinced that the decision (to cancel the drones) was the right one and it was taken at the right time," he told a news conference. "There were problems linked to my inclusion in the decision-making process. But I am determined to stay on and correct these problems."
Carsten Schneider, budget expert with the centre-left Social Democrats (SPD), rejected de Maiziere's explanations and urged him to resign, but opposition leaders were more restrained.
So far, the uproar does not appear to have damaged Merkel, who has earned the nickname "Teflon Angie" over the years for her ability to survive domestic blows with nary a scratch.
An opinion poll by Forsa released on Wednesday showed her conservatives extending their lead over the centre-left SPD to 17 percentage points with less than four months to go before the September 22 vote.
Still, because de Maiziere is so close to her, his departure would be seen as a heavy setback.
CLOSE TO UNTOUCHABLE
Merkel has watched a series of other allies forced out of office in recent years, leaving her vulnerable to accusations of poor judgment.
In February confidante Annette Schavan quit as education minister after being stripped of her doctorate for plagiarism. Last year, Merkel's hand-picked choice for German president, Christian Wulff, resigned in disgrace over financial favors.
"Merkel has been able to weather all of these affairs because voters don't believe that she would ever be tangled up in a scandal herself," Forsa head Manfred Guellner told Reuters.
"She exudes integrity, reliability, unpretentiousness. This has made her close to untouchable even as people around her fall by the wayside."
Guellner said Merkel also appeared to have emerged unscathed from an uproar over her generous campaign promises.
German media have accused her of trying to bribe voters with an estimated 28 billion euros in social spending even as she talks publicly about the need to balance the budget.
She has also faced an outcry for poaching one idea after the other from the SPD, including their plan to set a ceiling on rising rents in German cities.
"Some ideas, like the rent cap, can only be described as brazen rip-offs. The SPD has a right to cry foul," Sueddeutsche Zeitung daily wrote in an editorial. "But far more dangerous than accusations of copying others' policies is the impression that she lacks ideas of her own on the domestic policy front."
Despite the criticism, Merkel remains hugely popular. The Forsa poll showed 67 percent of Germans believe she is doing a good job and, if given a choice, 57 percent would choose Merkel as chancellor versus 20 percent for SPD rival Peer Steinbrueck.
In contrast, support for the normally popular de Maiziere sank 6 points to 45 percent in the poll. Before facing a parliamentary committee and holding the news conference on Wednesday, he had remained largely silent on the drone affair.
(Reporting by Noah Barkin; Editing by Stephen Brown)