Prime Minister Ryutaro Hashimoto late Sept. 11 reshuffled his Cabinet, retaining three key ministers and giving in to pressure to appoint Koko Sato, a veteran politician convicted of bribery, to the new lineup comprising 20 Liberal Democratic Party members.

Sato, as director general of the Management and Coordination Agency, will now handle administrative reform, Hashimoto’s top policy priority. Hashimoto’s third Cabinet is the first since World War II to include someone convicted of a serious crime.

Sato’s appointment drew fire from all opposition parties as well as the LDP’s two non-Cabinet allies, the SDP and New Party Sakigake. “Our chairwoman, Takako Doi, told Prime Minister Hashimoto in person (that Mr. Sato must not be appointed). We regret this appointment,” Shigeru Ito, SDP secretary general, said at a news conference.

Commenting on Sato’s selection, Hashimoto said that it was he who finally decided to task Sato with finding solutions to administrative reform problems.

“I know there are various criticisms against the appointment,” Hashimoto told reporters. “But I came to the conclusion (to select Sato) after considering the situation surrounding administrative reform.”

Hashimoto said the move to replace former Management and Coordination Agency head Kabun Muto with Sato, who heads an LDP panel on administrative reform, is intended to improve the administration’s ability to deal with such difficult problems as pressure from “zoku-giin,” the tribal legislators who lobby for specific industries.

Hashimoto retained Finance Minister Hiroshi Mitsuzuka and Health Minister Junichiro Koizumi so they can continue pursuing fiscal reform and pending changes in the medical insurance system, according to Kanezo Muraoka, who announced the new, all-male roster at the Prime Minister’s Official Residence following his own appointment as chief Cabinet secretary.

Hashimoto reappointed Defense Agency chief Fumio Kyuma so he can continue updating the 1978 guidelines on Japanese-U.S. defense cooperation, due to be completed Sept. 24.

Keizo Obuchi, Hashimoto’s longtime ally, was named foreign minister. As many as seven people from the Obuchi faction were given Cabinet posts, while each of the three other major factions received four postings. Hashimoto belongs to the Obuchi faction.

Hashimoto had planned to retain Kabun Muto as head of the Management and Coordination Agency, a body in charge of a planned reduction to halve the number of key government ministries by 2001, according to LDP sources.

Although Sato, 69, has served 11 terms in the House of Representatives, he has never held a ministerial position because of a past conviction for receiving bribes in connection with the Lockheed scandal in the 1970s. There was no legal problem in appointing him to the Cabinet because his three-year suspended sentence has passed.

Normally, politicians elected to the Lower House five or six times are considered ripe for the first Cabinet appointment.

Former Prime Minister Yasuhiro Nakasone, representing a 67-member faction within the LDP, demanded in a meeting with Hashimoto late Sept. 10 that Sato be given a post.

Hashimoto had been torn between that demand and those from the LDP’s ally, the Social Democratic Party, which wanted Sato kept out.

To other key Cabinet posts, Hashimoto named Mitsuo Horiuchi as minister of international trade and industry to replace Shinji Sato.

Ihei Ochi, a former transport minister, was named minister of agriculture, forestry and fisheries, while Nobutaka Machimura was appointed education minister.

Hashimoto also named Kokichi Shimoinaba as justice minister, Hiroshi Oki as Environment Agency chief and Muneo Suzuki as chief of both the Hokkaido Development Agency and the Okinawa Development Agency.

In announcing the new lineup at a nationally televised news conference, newly named Chief Cabinet Secretary Muraoka defended Sato’s inclusion and said the Cabinet’s main task is implementation of reforms.

“The case is over legally and he has long years of experience as a Diet member,” Muraoka said. He cited Sato’s experience as head of the LDP’s task force on administrative reform in supporting his appointment to chief of the Management and Coordination Agency.

In May 1986, the Tokyo High Court gave Sato a two-year prison term suspended for three years for taking 2 million yen in bribes from All Nippon Airways in 1972 while serving as vice transport minister. Sato withdrew his appeal to the Supreme Court two months later but has never admitted guilt.

In his own news conference Sept. 11, Sato deflected questions on whether the public can accept his appointment.

“It (the Lockheed scandal) was 26 years ago,” he said. “I would like to forget about the past and tackle the current issues. The public will judge me by my work.”

Asked if he thinks he is innocent, Sato said only that he wants to tackle his current task and forget about the past.

The Management and Coordination Agency director general handles administrative reform. Hashimoto’s other reforms involve finance, the economy’s structure, social welfare, the financial system and education.

The new Cabinet was announced at 5:30 p.m. At night, the members underwent an attestation ceremony by the Emperor at the Imperial Palace and held their first meeting.

Earlier in the day, Hashimoto was formally re-elected as LDP president at a plenary session of party members from the two Diet chambers.

Hashimoto will begin his second two-year term on Oct. 1, with no change in the ruling party’s top three posts.

Koichi Kato retained his post as LDP secretary general, along with LDP Policy Affairs Research Council Chairman Taku Yamasaki and LDP Executive Council Chairman Yoshiro Mori.

The SDP and Sakigake chose not to participate in the coalition following their defeat in the Lower House election in October.

Hashimoto’s previous Cabinet was formed Nov. 7. This time, Hashimoto is reshuffling the Cabinet with the LDP confident after having regained a simple majority in the powerful Lower House for the first time in four years.

For the Cabinet formation, the prime minister needs the consent of LDP heavyweights, including faction leaders, because the LDP is a de facto coalition of factions.

Usually, each faction has approximately four slots in a Cabinet, and for most appointments Hashimoto had to choose from names put forth by each faction.

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