TOKYO: Prime Minister Yukio Hatoyama came under fire over a funding scandal on Christmas Day, with Japanese media speculating that he might have to step down if voters find his explanations unconvincing and his leadership disappointing.

Hatoyama, whose Democratic Party swept to power in an August election that ousted their long-dominant conservative rival, said on Thursday he would not resign after two former close aides were indicted over false political funding records.

The indictments put Hatoyama's leadership to test at a time when polls show voter support has fallen below 50 percent from initial highs over 70 percent, as doubts grow over his ability to make tough decisions on the economy and diplomacy.