Prime Minister Junichiro Koizumi on Wednesday denied allegations that his Liberal Democratic Party had diverted donations from the Japan Dental Association to individual lawmakers.
He was responding to suspicions raised by Katsuya Okada, leader of the opposition Democratic Party of Japan, who questioned Koizumi's responsibility in the alleged money diversions during a one-on-one debate in the Diet.
"I have received a report (from the LDP) that there has been no such thing as diverted donations," Koizumi said.
It was the first time the leaders of the two largest political parties locked horns directly during the ongoing extraordinary Diet session.
Okada called on Koizumi to revise the Political Funds Control Law to make the practice of diverting donations illegal. Okada wants donations that have specific conditions placed on them banned, such as those that designate individual lawmakers as recipients.
Koizumi said such details should be left to the Diet committees concerned. He claimed he has heard "it is difficult to define a diverted donation."
The prime minister insisted that the LDP "has nothing to do with" a recent money scandal in which his party's largest faction, once led by former Prime Minister Ryutaro Hashimoto, received an unreported 100 million yen from the political arm of the dental association in July 2001.