TOKYO, Nov 15 (Reuters) A former top defence official embroiled in a scandal said he and senior ruling party lawmaker Fukushiro Nukaga, currently the finance minister, had dined with a defence contractor who was recently arrested for suspected embezzlement.
Former Vice Defence Minister Takemasa Moriya said under oath in parliament that former defence minister Fumio Kyuma had also dined with the contractor on a separate occasion.
The widening scandal is likely to further complicate Prime Minister Yasuo Fukuda's efforts to restart Japan's naval mission in support of US-led operations in Afghanistan -- stalled by opposition parties in control of parliament's upper house.
It could also damage the image of Fukuda's government as the Japanese leader struggles to implement policies in the face of the divided parliament, analysts said.
Media reports have said Nukaga, a former defence minister who who has quit cabinet posts twice in the past over scandals, received cash from the contractor.
Nukaga has said that he returned the cash and he has denied having any special ties to the firm.
''It appears that the contractor approached various politicians, not just Moriya,'' said Yasunori Sone, a political science professor at Keio University in Tokyo.
''If Nukaga had to quit, that would damage Fukuda and make it even harder to enact the new bill enabling the naval mission,'' he said, adding there was speculation the scandal might widen beyond just Nukaga.
Prosecutors last week arrested Motonobu Miyazaki, 69, a former top executive of Tokyo-based Yamada Corp, on suspicion that he had embezzled money from the firm's US unit to obtain funds to set up a new firm, Japanese media have reported.
Media have also been awash with speculation about a special slush fund set up by Miyazaki to court favours from officials and politicians.
Moriya has admitted that he played golf more than 200 times with Miyazaki over more than a decade and was treated to meals, trips and gifts.
But the 63-year-old ex-bureaucrat has denied he did favours for Miyazaki, who Japanese media said was not only politically well connected at home but had close ties with US defence officials as well.
Fukuda's predecessor, Shinzo Abe, abruptly resigned in September after a year plagued by scandals and gaffes that cost him five cabinet ministers, including one who committed suicide.
Voters angry at the scandals and other government bungling handed victory to the main opposition Democratic Party and its smaller allies in a July upper house election.
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