TOKYO, April 26, Reuter - Japanese Prime Minister Noboru Takeshita's closest aide killed himself on Wednesday, one day after the premier announced his resignation to take responsibility for the Recruit shares-for-favours scandal.

Ihei Aoki, who was named in scandal, committed suicide in his Tokyo apartment on Wednesday morning by slashing his wrist with a razor 17 times, then hanging himself with a necktie.

The ruling Liberal Democratic Party (LDP), meanwhile, threatened to break the stalemate which has stalled parliament for nearly two months and ram through the national budget despite a continuing boycott by opposition parties over the scandal.

Takeshita resigned on Tuesday after months of revelations about large payments from the Recruit publishing and telecommunications group to most of the leadership of the LDP, including himself.

He said he would remain in office until the budget passes parliament, expected by late May. Initial indications that the opposition would compromise quickly evaporated and the LDP was forced to continue budget discussions in parliament alone.

The LDP told the opposition it would call a plenary session of the Lower House on Thursday, an obvious threat to force through the budget regardless of whether the opposition parties take part.

"We are alarmed that the LDP will railroad the budget bill through," said a spokesman for the opposition Democratic Socialist Party.

Aoki, 58, Takeshita's former secretary, bought 2,000 shares in a Recruit subsidiary and took out a loan of 50 million yen (380,000 dollars) from the former president of the Recruit group.

Takeshita announced his decision to resign only two days after newspapers reported that Aoki had received the loan from Recruit.

Such financial dealings have been widely interpreted as being political contributions to Takeshita.

Takeshita, clearly stunned by the suicide, was asked by reporters whether the Recruit scandal had caused Aoki's death.

"I'll have to check his letters if there are any. But I think it is possible that pressures from the scandal could be one of reasons for suicide," he replied.

Aoki left a suicide note addressed to Takeshita but Kyodo News Service reported that the prime minister had refused to reveal its contents.

It was almost a carbon copy of a case in 1976 when the secretary of former prime minister Kakuei Tanaka committed suicide after he and his boss were implicated in the Lockheed bribery scandal.

The main candidate to succeed Takeshita, 75-year-old former foreign minister Masayoshi Ito, continued publicly to deny any interest in the job despite a growing feeling that he would have to relent eventually for the good of the party.

Ito is the only member of the LDP's leadership who has not been implicated in the Recruit scandal and political analysts say his "Mr Clean" image could help drag the party's popularity rating off rock-bottom.