Prime Minister Toshiki Kaifu, under pressure from party leaders, has agreed to form his third Cabinet Saturday, Japanese news reports said Friday night.
Kaifu met Friday evening with Ichiro Ozawa, secretary general of the ruling Liberal Democratic Party, to settle the timing and nature of the shuffle.Kaifu may hold over certain key members, such as Finance Minister Ryutaro Hashimoto, but Foreign Minister Taro Nakayama is being pressured by his faction to make room for another member, NHK, Japan's public television network, reported.
The influx of new members may include scandal-tainted politicians whom Kaifu had vowed to keep out of his government, leading Japanese newspapers said.
In his first Cabinet shuffle, in February, he resisted enormous pressure to place scandal-tainted cronies of faction leaders on his team.
The second Cabinet shuffle, which Kaifu had tried to put off until the new year, comes at the behest of powerful politicians eager to return to their constitutencies for the holidays with the stripe of Cabinet membership on their shoulders.
Until the Friday meeting, Kaifu had repeatedly said there were urgent matters to be dealt with first, citing the national budget, political reform and international problems in the Gulf and Soviet Union.
But Kaifu, who took office in August 1989 with a pledge of reform, appeared to have lost his battle with faction leaders within the ruling party.
Kaifu is a mid-level member of one the party's smallest bodies, the Komoto faction, which is known for its clean politics.
His administration was widely viewed as a caretaker after two prime ministers - Noboru Takeshita and Sousuke Uno - left office in disgrace within three months in 1989.
Kaifu led his party to a resounding victory in general elections in February, but has been unable to translate his popular success into a power base within the party.
Meanwhile, government officials said Friday that Japan is set to increase defense spending by 5.47 percent for the fiscal year beginning April 1, 1991.
Finance Minister Ryutaro Hashimoto and other ministers concerned agreed to set the defense budget for 1991-92 at $32.2 billion, the officials said.
Kaifu's cabinet will formally approve a government draft budget, including the defense increases, on Saturday, they said.
The planned spending is in line with a new five-year defense plan for 1991-95 which calls for a slowdown in defense spending growth to reflect easing global tensions.