Koizumi ally quits politics over scandal

In happier times: Kato was dubbed the "prince"

A close political ally of the Japanese prime minister who himself had been regarded as a future leader has announced that he will resign from parliament over a scandal involving a former aide.

Kato has been under pressure to resign since last month

Koichi Kato, who has already resigned from the ruling Liberal Democratic party, said he was stepping down in order to take "political, social and ethical responsibility" for the incident.

He had been resisting calls for his resignation from parliament since last month when his former secretary, Saburo Sato, was arrested for massive tax evasion.

Correspondents say the scandal is a major embarrassment for Japan's leader, Junichiro Koizumi, who is struggling to persuade an increasingly sceptical public that he is committed to political and economic reform.

Monday's announcement threatened to overshadow a piece of good news for Mr Koizumi's ruling coalition - a candidate it backed won the race for governorship of Kyoto on Sunday.

Testimony

Mr Kato, 62, made the announcement on Monday during his testimony to parliament over the case of Mr Sato and additional allegations that he himself had misused campaign funds.

Mr Sato was arrested for allegedly evading 100m yen ($759,500) in income tax.

Mr Kato is also reported to have received about 90m yen ($676,000) of political donations in his personal bank account since 1997, which he is alleged to have used for his own expenditures, including the rent of an expensive Tokyo apartment.

Donations to politicians in Japan above 50,000 yen ($376) should usually be reported, but local media say Mr Kato did not report any between 1998 and 2000.

Mr Kato resigned from his position as secretary-general of the LDP last month after interrogations by an opposition leader, Kiyomi Tsujimoto, who herself was then forced to resign after revelations of financial wrong-doing in her office.

'Prince' of politics

Once dubbed "prince", he had been part of the so-called "YKK Trio" - referring to Koizumi, Kato and current party secretary general Taku Yamasaki.

They had all been viewed as champions of reform.

But Mr Koizumi's personal ratings have dropped 40 percentage points since he took office a year ago, reflecting the public's disappointment over a rash of political scandals.

Dirty politics is not a new phenomenon in Japan but the number of incidents this year has been unusually high.