* Voters prefer grand coalition to DPJ-led govt-poll
* Coalition could enact key bills, break policy deadlock
* Influential business lobby also backs coalition (Adds quotes; business lobby)
By Chisa Fujioka
TOKYO, June 6 Japanese voters want the ruling party to form a coalition with its main rival instead of governing on its own, a poll showed on Monday, as pressure mounted on Prime Minister Naoto Kan to quit.
Kan's early exit would ease the way for a coalition with the main opposition party that could enact a bill enabling Japan to issue more debt to fund this year's $1 trillion budget.
A coalition between the ruling Democratic Party (DPJ) and the opposition Liberal Democratic Party (LDP) could also pass an extra budget to pay for rebuilding parts of the northeast devastated by the March 11 earthquake and tsunami which killed about 24,000 people and triggered the world's worst nuclear disaster since Chernobyl in 1986.
In a poll by the Mainichi newspaper, 36 percent of voters said they wanted a coalition of the two biggest parties once Kan steps down. Only 13 percent favoured a government led by the ruling DPJ. The same percentage wanted a government led by the opposition LDP.
A further 33 percent said they would favour another form of government. This generally refers to a realignment of parties or support for the handful of smaller groupings in parliament.
Hiromasa Yonekura, chairman of influential business lobby Nippon Keidanren, also urged the formation of a coalition.
Kan, already unpopular before the quake struck, has seen his ratings fall due to his perceived mishandling of the recovery and continuing radiation leaks at the Fukushima nuclear power plant, where the tsunami knocked out reactor cooling systems.
Kan, Japan's fifth leader in as many years, survived a no-confidence motion in parliament last Thursday after promising critics in his own party he would quit.
He then angered many by hinting he wanted to keep his job into the new year to deal with the most pressing problems, especially the radiation crisis.
But with a stalemate in parliament, polls have showed voters more receptive to the possibility of a grand coalition.
The opposition, which controls parliament's upper house and can block bills, has refused to cooperate with the government in enacting key legislation as long as Kan remains in power.
On Sunday, the DPJ's No.2 official, Katsuya Okada, said a temporary coalition would be needed to implement policies given that the hung parliament might continue until the next upper house election which must be held by late 2013.
He said on Monday that smaller parties were also potential partners, not just the LDP.
Chief Cabinet Secretary Yukio Edano called for speedy policy decisions, but declined to elaborate when asked about the possibility of a coalition.
"It's desirable to have a structure in which we have broad cooperation in parliament," Edano said. "The party is working out details."
LDP leader Sadakazu Tanigaki was quoted by Kyodo news agency as saying the party would not help a Kan-led government to pass the bill to issue bonds for this year's budget.
It is unclear, however, whether a temporary grouping could tackle longer-term problems, such as huge public debt, now twice the size of the $5 trillion economy.
While the LDP has called for Kan to quit by the end of the month, analysts say his departure could take longer.
"None of the contenders has strong public support," said Tetsuro Kato, political science professor at Tokyo's Waseda University.
Among possible contenders to replace Kan are Finance Minister Yoshihiko Noda, a fiscal hawk, Deputy Chief Cabinet Secretary Yoshito Sengoku, who has advocated a coalition with the LDP, and conservative former foreign minister Seiji Maehara. (Additional reporting by Shinichi Saoshiro; Editing by Nick Macfie)
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