Analysis: Israel's political turmoil

Deal off: Barak has declined a post in Sharon's government

By Middle East analyst Roger Hardy

Israeli politics have been thrown into confusion by the surprise decision of caretaker Prime Minister Ehud Barak not to take part in a national unity government with the right-wing Likud Party.

Mr Barak is, after all, to withdraw from politics, as he had originally indicated following his crushing defeat to Likud leader Ariel Sharon in prime ministerial elections.

He will also give up the leadership of the Labour Party.

So where does this leave the prospects for a national unity government?

Career over? Barak says he will give politics a break

In a climate of vitriol and recrimination, harsh even by Israeli standards, Ehud Barak has finally called it a day. He has belatedly realised he has virtually no political allies left.

He has been stung by the behaviour of Ariel Sharon who initially offered him the post of defence minister in a unity administration.

But Likud officials then hinted they might just as easily give the job to another former Labour Prime Minister, Shimon Peres.

Mr Barak's own Labour Party was meanwhile tearing itself apart - divided not only over whether to join Likud in government, but also over whether Mr Barak should remain party leader.

Labour leadership contender: Avraham Burg

Though still split, prominent figures in the party seem to have decided he was too discredited to stay on as leader - but, on balance, they favoured a national unity government.

Labour's central committee is to meet on Monday, with the current speaker of parliament, Avraham Burg, the favourite to become party leader.

Key figures in the leadership struggle include:

• Shimon Peres, who may lend his influence to his favoured candidate or even join the race himself. But at 77 years of age he is considered by many too old to lead the party

• Haim Ramon, who was interior minister in the Barak administration. Perceived as a rival to Ehud Barak, and in recent months relations with the prime minister cooled

• Yossi Beilin - the dovish minister of justice within the Barak government - has warned that he will leave the party and take a number of parliamentary colleagues with him if it teams up with Likud.

Commentators have not ruled out this possibility that Labour will split and a new left-wing group form as a result.

Whatever the outcome, Labour has been seriously damaged by this whole affair and now faces the difficult task of trying to regain some credibility.