Bloomberg News

Kan Says He’ll Resign After Passage of Quake, Energy Bills

June 14, 2011

(Adds Cabinet approval of bill in sixth paragraph.)

June 14 (Bloomberg) -- Japan’s Prime Minister Naoto Kan, who is under pressure to specify when he’ll fulfill a promise to resign, said he wants to stay until winning passage of a renewable energy bill and a second disaster spending plan.

“I will fulfill my responsibility for the urgently needed second supplementary budget, the bill on renewable energy and other bills now before parliament,” Kan said at the upper house of parliament today. “Then I will pass my responsibility onto the next generation.”

Kan sparked a leadership vacuum in his Democratic Party of Japan earlier this month when he promised to leave office in order to win support to defeat a no-confidence vote against him. Since then he hasn’t given a target date for resigning and his predecessor Yukio Hatoyama accused him of going back on an agreement to step down by June.

Japan’s second spending plan will include items such as payments to local authorities and assistance for disaster victims with loans, Kan told lawmakers today.

“We will include urgent measures in the next supplementary budget to be compiled in July if possible,” Kan said. “I’ve won approval from Cabinet ministers on this direction.”

Kan’s Cabinet today also approved a bill to set up a public entity to aid Tokyo Electric Power Co. as it compensates victims of the disaster at the Dai-Ichi nuclear plant in Fukushima. The plan, which must be approved by parliament, is partially intended to keep Tokyo Electric from passing on costs to consumers, Chief Cabinet Secretary Yukio Edano said.

Shares Climb

Tokyo Electric surged as much as 25 percent to 249 yen after the Cabinet approval and news that the Tokyo stock exchange clamped down on short-selling of the shares. The benchmark Nikkei 225 Stock Average rose 1.1 percent today to close at 9547.79.

Kan said on June 2 his responsibility was to stay until a cold shutdown at the crippled Fukushima Dai-Ichi nuclear power plant, which Tokyo Electric Power Co. said it hopes to achieve by January. On June 9, Kan told lawmakers he must stay until progress is made on temporary housing and removing debris, which the government hopes to achieve by the end of August.

Japanese Finance Minister Yoshihiko Noda said today the nation’s next extra budget probably won’t require bond sales. Noda told reporters Kan asked him to compile the budget in July.

Support Falls

Kan’s public support fell to 22 percent in an Asahi newspaper survey published today, down from 28 percent earlier this month. The survey of 1,980 people taken June 11-12 didn’t provide a margin of error.

DPJ Secretary-General Katsuya Okada is a potential successor to Kan, as are Edano and former foreign minister Seiji Maehara. All were among a group voters cited as preferable candidates in a Nikkei newspaper survey published May 30.

Before Japan’s largest recorded earthquake on March 11, Kan had failed to win support for higher taxes needed to reduce the country’s deficit. His leadership during the crisis at the Dai- Ichi nuclear plant has been widely criticized, with 63 percent of participants in the Asahi poll saying they disapproved of his handling of the disaster.

More than three months after the earthquake and tsunami disabled power generators at Dai-Ichi, workers are struggling to contain what has become the world’s worst nuclear disaster since 1986.

Tokyo Electric plans to start decontaminating millions of liters of water poured over melted reactors and by the end of the year it expects to have separated 2,000 cubic meters of highly radioactive sludge, Teruaki Kobayashi, a nuclear facility manager at Tepco said in an interview.

--Editors: Patrick Harrington, Peter Hirschberg

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To contact the reporter on this story: Sachiko Sakamaki in Tokyo at ssakamaki1@bloomberg.net

To contact the editor responsible for this story: Peter Hirschberg at phirschberg@bloomberg.net -0- Jun/14/2011 01:45 GMT


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