By Linda Sieg

TOKYO (Reuters) - Japan will hold an election for the upper house on July 21, the government said on Wednesday, effectively launching campaigning for half the seats in the less powerful of parliament's two chambers.

Expectations had simmered for Prime Minister Shinzo Abe to call a snap election for the lower house, but last week he said he was not considering such a move.

The ruling coalition, led by Abe's Liberal Democratic Party is expected to keep its majority, though possibly with reduced numbers in the chamber, as support for it exceeds that for the fragmented opposition despite a recent furor over pensions.

"The biggest focus of this upper house election is whether we will advance reforms for a new era under stable politics, or turn back the clock to that chaotic era," Abe told a news conference.

He was referring to events that unfolded after his conservative LDP suffered a huge defeat in a 2007 upper house poll. Two months later, Abe quit as premier after just one year.

The defeat set the stage for the LDP's ouster in 2009 by the center-left Democratic Party of Japan (DPJ). Abe then led the LDP back to power in December 2012 after a three-year DPJ rule marred by infighting.

However, Abe's flashback mantra is wearing thin after more than six years of LDP rule, said Yukio Edano, the head of Japan's biggest opposition party, a successor to the DPJ.

"The more they say it, the more it casts a pall on them," the Constitutional Democratic Party of Japan leader told Reuters in an interview. "I think voters want a positive message."

Abe appears to hope a successful performance as host of the June 28-29 summit of the leaders of the Group of 20 in the western city of Osaka will bolster his ruling bloc's results.

Abe's support rate was hit by the furor over a government report that suggested many elderly would not be able to live off pensions alone, but backing for his LDP still dwarfs that for fragmented opposition parties.

Upper house elections are held every three years and members' terms run six years. The LDP won a landslide victory in 2013, but fared somewhat less well in 2016, and will be trying to hold down the reduction in its members.

Reforms last year take to 245 the number of upper house seats, from 242, and 124 will be contested in this round.

Attention will also focus on whether the ruling bloc and the smaller Japan Innovation Party together retain a two-thirds "super majority" needed to revise the post-war, pacifist constitution, a long-held goal for Abe.

(Additional reporting by Kiyoshi Takenaka, Tetsushi Kajimoto and Ami Miyazaki; Editing by Chang-Ran Kim and Clarence Fernandez)