Japan's ruling coalition stays in charge

After leading his ruling bloc to a narrow victory in national elections, Prime Minister Junichiro Koizumi today said he would immediately begin following through on campaign pledges to privatise money-losing public agencies and reform the tax system.

But he avoided offering any details about the touchier topic of sending troops to Iraq.

The poll was the first major test for Koizumi since he took power more than two years ago, and the opposition’s strong gains are likely to pressure him to show that his reforms are still on track.

Koizumi said the three-party bloc’s success at securing a majority of the 480-seat lower house of Parliament ensured a popular mandate to continue with reforms.

“We have won the people’s support,” he told a press conference at Liberal Democratic Party headquarters.

Although the LDP alone had failed to win a simple majority of the chamber’s 480 seats in the poll, Koizumi said his party had nearly reached the level by linking up with three candidates who had run as independents.

According to preliminary results, Koizumi’s Liberal Democratic Party won 237 seats. The post-election additions raised its tally to 240, Koizumi said. Including its two smaller partners, the Buddhist-backed New Komeito Party and the New Conservative Party, it had 278, down from 287 before the election.

Koizumi said his administration would hammer out details for tax cuts, public pension reforms and privatisation of the highways administration. He also pledged to continue prodding banks to dispose of their massive loans to revive the world’s second-largest economy.

But Koizumi’s ruling bloc will be up against a more formidable opposition Democratic Party. The Democrats’ gains signal a shift away from a political system that has long been dominated by a single party – and growing dissatisfaction with the conservative LDP’s inability to end an economic slowdown that has persisted for 13 years.

“Koizumi won’t face any major hindrance in Parliament. But the opposition has established a beachhead from which it can creep closer to taking power or actually oust the LDP in future elections,” said Shigezo Hayasaka, a former aide to the late Prime Minister Kakuei Tanaka.

The returns also showed voters are increasingly split between just two parties.

The Democrats boosted their seats to 177 – 40 more than they previously held. That result assured a more unified opposition than its predecessor, albeit not one large enough to take over from the LDP, which has ruled for nearly all of the past 50 years.

Koizumi acknowledged that voters had defected.

“There are many people who felt strongly about fostering the opposition that could challenge the ruling party with stable numbers,” Koizumi said.

Other, smaller opposition parties did not do so well. The Communist Party captured just nine seats, down from 20 previously, and the Social Democratic Party won six, down from 18.