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Last Updated: Wednesday, 3 May 2006, 09:55 GMT 10:55 UK
Analysis: Israel's new coalition
By Katya Adler
BBC, in Jerusalem

Israeli PM-designate Ehud Olmert (R) and Foreign Minister Tzipi Livni
Kadima's top names have got 12 cabinet portfolios, out of 25
Israel gets a new government this week, but how stable is it and what effect, if any, will it have on Israeli-Palestinian relations?

Israel's Prime Minister designate Ehud Olmert will present his coalition to parliament, the Knesset, on Thursday.

With 25 ministers, his is one of the largest cabinets in Israel's history. But it is not quite the big bang in Israeli politics predicted by the media before the general election.

Every Israeli government is a coalition because of the nature of Israel's political system.

Following elections, the country's largest party has to decide which other political groups will best help it achieve its aims and at what cost in terms of key ministries.

After coming first in March, Ehud Olmert's Kadima party said any coalition partner would have to sign up to his plan to fix permanent borders for Israel by 2010.

Fate of settlements

Kadima's plan is viewed as bold, controversial and, according to many Israelis, improbable.

Israel celebrated its 58th birthday on Wednesday, but in all those years its borders have never been clear.

Palestinians attack Israeli army jeep in Nablus
Many Israelis want to end to their occupation of Palestinian areas
Permanent borders will make the country more secure, Mr Olmert says.

He wants to evacuate some isolated Jewish settlements in the West Bank, keeping other, larger ones and consolidating Israel's hold on East Jerusalem.

Israel occupied the land in the 1967. Under international law, all Jewish settlements are illegal - although Israeli disputes this.

After years of bloody conflict, some sections of Israeli society favour abandoning the settlements altogether. Others say not a single Jew should be uprooted, because it "rewards Palestinian terrorists".

Mr Olmert's plan is seen by many as a compromise between the different Israeli viewpoints. Sixty thousand out of a total of 400,000 Jews who live in the West Bank, including East Jerusalem, could be forced to leave their homes.


Kadima's plan has been presented as a dramatic vision for Israel's future.

But after seeing Mr Olmert's cabinet line-up, much of the Israeli media predict the big bang will result in little more than a whimper.

His main problem is that Kadima did not do as well as hoped in the election - winning only 29 seats out of 120.

Opinion polls predicted Mr Olmert's predecessor and Kadima's founder, Ariel Sharon, would have secured 40 parliamentary seats.

The political heavyweight has been in a coma since suffering a stroke in January. Mr Olmert risks standing forever in his shadow.

Controversial appointment

Before choosing coalition partners he had to think carefully which political parties would sign up to his borders plan and not challenge his authority.

Labour leader Amir Peretz
Union man Amir Peretz is an unusual choice of defence minister
The Labour Party - which came second in the election - was an obvious ally, having long spoken in favour of giving up land in the West Bank.

But it was also in a position to drive a hard bargain with 19 parliamentary seats to offer the Olmert government.

In the end, it secured 7 cabinet positions, including Mr Olmert's most controversial appointment: Labour leader Amir Peretz as Israel's new defence minister.

The defence portfolio is usually given to someone with a prestigious military background, not someone like Mr Peretz, a former firebrand leader of Israel's largest trade union federation.

Such an appointment is unlikely to make Israeli society feel any less vulnerable - with the militant Hamas movement having won Palestinian elections and the possibility of a nuclear threat from Iran.

Wide differences

Kadima and Labour may also turn out to be uncomfortable bedfellows.

In economic terms, Kadima leans to the centre-right and Labour to the centre-left.

Labour wanted the Finance Ministry to push through some costly social reforms. It failed to get it, but still insists that the minimum wage, and pension and health benefits, be raised in Israel.

In terms of security there are big differences too.

Labour favours a negotiated land agreement with Palestinian Authority President Mahmoud Abbas.

Members of Israel's Pensioners Party who won seats
New political force: the Pensioners Party won seven seats
Kadima has so far refused to speak to any Palestinian leader since the Hamas election and has spoken openly of taking unilateral steps in the West Bank.

It will be interesting to see the reaction of both parties if, as Mr Abbas has indicated, he invites them to take part in an international peace conference once their government has been sworn in.

Palestinians are opposed to Israel acting unilaterally. Most are against Mr Olmert's border plan which they say will make a future united Palestinian state an impossibility.

Volatile politics

Aside from Labour, Ehud Olmert has also signed coalition agreements with two smaller political factions: the single-issue Pensioners' Party (Gil) and the ultra-orthodox Shas.

The Shas agreement has cost Mr Olmert credibility.

He had initially announced that no party could join his government without agreeing to his border plan. Shas refused. But Mr Olmert invited them to join anyway.

Kadima has kept hold of 12 ministries, including the post of Prime Minister.

Rising stars in the cabinet are Tzipi Livni, who has been named deputy prime minister and is only the second Israeli woman to head the Foreign Ministry. Close Olmert allies Roni Bar-On and Abraham Kirschon have been made interior and finance ministers respectively.

With Labour, Shas and Gil on board, Ehud Olmert's government has 67 seats in Israel's parliament, enough to form a stable government - for now.

He is well aware, though, of the volatility of Israeli politics and is continuing negotiations with other factions which he could invite into the fold at a later date.

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