After more than three months of negotiations, the Austrian Social Democrats and the centre right Peoples' Party moved a step closer to renewing their coalition government.

Both parties have approved a joint policy programme -- although they have yet to agreed on the distribution of cabinet seats.

The deal would keep the far-right Freedom Party, -- which came second in last October's elections --out of government. The Freedom Party leader, Joerg Haider, sparked international controversy with remarks interpreted as pro-Nazi.

Israel has threatened to cut off ties with Austria if Mr Haider comes to power.

From the newsroom of the BBC World Service