Former Foreign Minister Makiko Tanaka on Wednesday categorically denied allegations she misappropriated the state-paid salaries of her secretaries.

Her statements, however, were widely seen as lacking in sufficient explanation.

Tanaka was speaking during a two-hour session of the House of Representatives Deliberative Council on Political Ethics, which was open to the media for the first time since the ruling and opposition parties pushed for an open session.

"I want to make it clear that I have not done anything (as alleged in media reports)," Tanaka said in her opening statement. "Since I entrusted the family firm with the financial affairs of my secretaries I had nothing to do with it."

However, she admitted that part of her secretaries' salaries for several months from February 1998 were not settled by Echigo Kotsu Co. due to clerical errors.

Tanaka said her support organization made up the payments earlier this month.

Echigo Kotsu, based in Nagaoka, Niigata Prefecture, is a bus operator that the Tanaka family runs.

Hisayasu Nagata, a lawmaker from the Democratic Party of Japan, the main opposition group, told the session that a document he obtained only three hours after visiting Nagaoka suggested Tanaka diverted the salaries of secretaries to pay her private aides in June 1996, and possibly did the same on other occasions.

"I don't know much about it because I had let (somebody else) handle it," Tanaka responded.

Tanaka said the government-paid salaries of her secretaries were first delivered to Echigo Kotsu in unopened envelopes, adding the company properly dealt with the money, paying the secretaries the firm's salary, secretarial benefits and deducting residential tax.

Echigo Kotsu officials pooled the remaining amount, which was appropriated for various allowances at the end of the fiscal year, she said, stressing the bus company did not shoulder her secretaries' salaries.

According to Tanaka, the secretaries wanted to be sent on loan from Echigo Kotsu instead of being suspended for a certain period because they faced losing their jobs if Tanaka was not re-elected.

Prime Minister Junichiro Koizumi said: "I only listened to part of the testimony but I am under the impression that the suspicion still remains. She needs to behave sincerely to clear the air."

Senior members of the ethics council will meet next week to discuss what to do, including whether to hold another council meeting for further testimony, Lower House officials said.

The allegations first surfaced in April when two weekly magazines reported that Tanaka misused taxpayers' money earmarked for her secretaries.

In June, the Liberal Democratic Party suspended Tanaka from party membership for two years for failing to cooperate with a party probe into her financial affairs.

It was the fourth time the council has heard testimony, the last being when former Defense Agency chief Fukushiro Nukaga testified in February 2001 for allegedly taking bribes from a mutual aid group for small businesses.

Tanaka was Koizumi's key ally in his campaign for LDP president in April 2001. But in January, Koizumi sacked her as Foreign Minister due to a spat with lawmaker Muneo Suzuki, who has been arrested on bribery allegations, and Yoshiji Nogami, the ministry's top bureaucrat.