Chief Cabinet Secretary Yasuo Fukuda said Tuesday he has returned wages he received from October to June in response to the public outcry over a Foreign Ministry fraud scandal involving the Cabinet Secretariat's secret funds.

Fukuda said he returned the wages, which he earns on top of annual allowances as a lawmaker, to take political responsibility for a fraud case involving Katsutoshi Matsuo, a former Foreign Ministry logistics chief.

Government officials said wages returned to state coffers totaled 2 million yen.

Fukuda also announced the Cabinet Secretariat will seek 10 percent fewer discretionary funds in the fiscal 2002 state budget. A total of 1.62 billion yen was allocated in the initial budget for fiscal 2001.

The secretariat will also aim for a 10 percent reduction in its use of the classified funds for the current fiscal year by cutting unnecessary expenses, he said.

Matsuo, the former logistics chief, has been charged with swindling 506 million yen from the state by padding hotel expenses while coordinating overseas trips for Japanese prime ministers.

Fukuda said he returned the salary earned as chief cabinet secretary since taking office in October because he feels he is politically responsible for the case as minister in charge of the funds.

Fukuda also said that while the alleged crimes were committed before he assumed the post, he does not plan to urge former chief cabinet secretaries to return their salaries.

He added that other Cabinet Secretariat officials will not be punished over the case because it would have been "extremely difficult" for any of them to detect the fraud.

The Foreign Ministry also said last week it will cut 40 percent from the diplomatic discretionary funds requested in the fiscal 2002 state budget, following a series of scandals, including the Matsuo case.