Japan PM makes postal reform pitch in TV debate

TOKYO - Japanese Prime Minister Junichiro Koizumi presented his case for postal privatisation during a televised debate on Monday, saying selling off Japan Post was the key to further structural reform and revitalising the economy.

The leaders of of Japan's main opposition parties countered that the September 11 vote was more than a referendum on Koizumi's long-cherished goal and criticised his record on reform.

Koizumi called the election after rebels in his Liberal Democratic Party joined the opposition this month to kill bills to privatise the post office, a vast business with $US3 trillion ($NZ4.36 trillion) in assets including a savings bank and insurance business.

"The parliament said it's not necessary, but I've believed it's at the heart of structural reforms. So I want to ask the Japanese people what they really think," Koizumi, the only leader not wearing a tie, said at the start of the two-hour debate.

Katsuya Okada, head of the main opposition Democratic Party, said true reform could only come with a change in government.

"We want to stress the importance of pension and child-care issues... The Koizumi government cannot achieve these reforms, we need a change in government," said Okada, with his usual straight-faced demeanour.

The debate pitted a relaxed-looking Koizumi and his coalition partner, New Komeito leader Takenori Kanzaki, against the heads of four opposition parties, including the Democrats and a tiny group formed by former LDP rebels.

The campaign, in which Koizumi has been cast by media as a feudal lord sending "assassins" to destroy "traitors" in his own party, has gripped Japan's normally politically apathetic public.

Financial markets are also watching for clues to whether Japan will proceed with vital economic reforms, and a poll by Reuters and Jiji news agency showed that a vast majority of experts polled expect the ruling camp to remain in power.

Seventy-five of the 80 analysts, traders and fund managers surveyed in the poll said they expected the coalition to win a majority in the election. Not a single respondent forecast the Democrats would wrest power from the LDP.

As expected, Japan's biggest business lobby, the Japan Business Federation (Keidanren), also said on Monday that it would support Koizumi's LDP in the election.

Koizumi's forceful tactics and pledges of reform -- the same promises he made when he swept to power four years ago -- appear to have resonated with many voters, bolstering support for the LDP to about twice that for the Democrats.

Two surveys published over the weekend, however, showed that support for the Democratics has risen slightly, especially among "floating voters" who shun any party ties.

The Democrats' Okada has challenged Koizumi to a US presidential style debate, but Koizumi has rejected the idea, saying it would be "unfair" to other opposition parties.

Koizumi has said he will resign if the LDP and New Komeito fail to win a majority in the 480-seat lower house. Okada has also promised to quit his post if the Democrats can't take power.

The LDP, which has ruled for most of the past half century, had 249 seats in the chamber before it was dissolved, while the Democrats had 175.

But the LDP refused to recognise as official candidates 37 incumbents who voted against Koizumi's bills to privatise the postal system, which has long been a source of funds for wasteful public works.

Most of those rebels still plan to run against LDP official candidates, many of them women handpicked by Koizumi.

With a hefty group of voters undecided -- about 40 percent according to an Asahi newspaper poll -- analysts said it was difficult to predict how much the tide could shift.

Unaffiliated voters are especially prone to decide at the last minute.

"There are an awful lot of floating voters who make up their minds three seconds after they enter the polling booths," said Steven Reed, a political analyst at Chuo University near Tokyo.

- REUTERS