Japan's opposition seeks to force election

Japan's opposition stepped up efforts today to force an early election by stalling key bills including help for struggling banks…

Japan's opposition stepped up efforts today to force an early election by stalling key bills including help for struggling banks.

The bickering could delay a government bill to allow the injection of public funds into regional and other banks, mainly to facilitate loans to smaller firms facing a credit crunch.

Legislation to extend Japan's naval mission in support of US-led operations in Afghanistan after it expires in January has also become ensnared in the manoeuvering.

Japan's economy slipped into recession for the first time in seven years in the July-September quarter, as the global financial crisis slashed overseas demand and a strong yen made Japanese exports less price competitive.

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The main opposition Democratic Party is refusing to bring the refuelling and bank recapitalisation bills to a vote in the upper house, which it controls together with small allies, media and ruling party executives said.

Delaying the first could create friction with president-elect Barack Obama's new administration, while stalling the latter would spell bad news for some regional banks and their smaller corporate customers.

The ruling bloc can enact bills rejected by the upper house by using its two-thirds majority in the lower house, but if the upper house declines to hold a vote, 60 days must elapse from the time the legislation was first approved by the lower chamber.

That means parliament's current session would need to be extended beyond its scheduled end on November 30th into early January to enact both the naval mission law and the banking legislation.

The Democrats argue that a refusal by Prime Minister Taro Aso to say when he would submit an extra budget to fund a promised package of stimulus steps means he has gone back on a promise to put the economy first.

Behind the political squabbling, however, is a clash over the timing of an election for the more powerful lower house. No election need be held until September 2009.

Reuters