TOKYO, 21st December 2009 : Japanese Prime Minister Yukio Hatoyama, his ratings slipping on doubts about his leadership, weighed on Monday whether to keep key campaign pledges or try to rein in a huge public debt worrying investors and voters alike.

Support for Hatoyama’s three-month-old government sank as low as 48 percent in surveys published on Monday and the weekend as he faced potentially divisive decisions to keep the fiscal 2010/11 budget on track.

The polls showed voters were disappointed by Hatoyama’s apparent inability to make quick decisions, but were open to him backtracking on election promises in view of rising debt.

Hatoyama is scrambling to put together the budget for the year from April 1 by the end of this month. He said he might decide later on Monday whether to limit child allowances to lower-income families and keep the surcharge on gasoline.

“Now is the time to decide,” Hatoyama told reporters. “The most important thing is to create a government that can respond to the people’s hopes.”

Hatoyama’s Democrats, joined in an awkward coalition with two small but noisy partners, took office in September pledging to put more cash in consumers’ pockets.

But with public debt approaching 200 percent of GDP, more than 70 percent of respondents in two surveys said they believed income limits should be set on eligibility for child allowances. More than half said the gasoline surcharge should stay in place.

That could make Hatoyama’s immediate budgeting task easier, but the decline in ratings might undermine his party’s chances in a critical election to parliament’s upper house in mid-2010.

About three-quarters of respondents in the Asahi poll said Hatoyama had failed to show leadership and about a third in all three polls said they did not back his government.

Hatoyama needs to find ways to keep a promise to hold new bond issuance to 44 trillion yen ($486.5 billion) next fiscal year despite falling tax revenues.

Export figures issued on Monday, however, offered some relief, with a 4.9 percent rise in November from the previous month reducing fears of another recession next year.

The polls also showed public concern over Hatoyama’s delay in deciding how to relocate a U.S. airbase on Japan’s southern island of Okinawa, irritating security ally Washington.

The expected indictment of a former aide to Hatoyama over misreported political funds is also adding to voter doubts, but 54 percent in the Mainichi newspaper survey said the prime minister need not resign if the aide was charged in the scandal.

Hatoyama’s troubles have not so far translated into good news for the opposition Liberal Democratic Party (LDP). The Asahi said 42 percent backed the Democrats against 18 percent for the LDP.

The Democrats need to win a majority in the upper house to free themselves from the coalition with two tiny but vocal parties whose support is needed in parliament’s upper house to enact bills smoothly.