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Paul Adams reports from Jerusalem
"There now seems to be a deal of sorts"
 real 28k

Wednesday, 29 December, 1999, 04:59 GMT
Shas signals Israeli coalition deal

Ehud Barak shakes hands with the Shas leader (right) in parliament


Officials from Israel's leading religious party, Shas, say they have reached agreement with the Prime Minister, Ehud Barak, in a dispute which had threatened the country's governing coalition.

The Shas Party chairman, Eli Yishai, told Israeli television that one point remained unresolved, but that a draft agreement should be finished on Wednesday.

Mr Barak has agreed to provide more money for the Shas Party's financially-troubled religious schools.

In a sign that the deal was on its way, Shas ministers on Tuesday voted in favour of a key stage of the budget. The vote on pre-budget appropriations bills was approved by 66 votes to 34 with eight abstentions.

Minority threat

On Monday, Shas threatened to pull out of the government in a dispute over next year's budget, a move which would have left Mr Barak leading a minority government.


Eli Ishai Shas leader Eli Ishai has secured more funds for the party's network of schools
The Shas party leader gave some of the details of the deal to Israeli radio.

Mr Yishai, who is also Minister of Labour, said 70m shekels ($16.5m) would be allocated to offset the religious schools' current deficit, and the budget allocation for 2000 would be increased by 25% to 162m shekels ($38.5m).

Shas Knesset Member David Azulay said that the problem was "not financial, but Shas's feeling of humiliation in the coalition". Shas has demanded that Education Minister Yossi Sarid be replaced.

There are no signs that this wish has been met.

Barak backing

Shas, which draws its support from Sephardic Jews of Middle Eastern origin, is the third largest party in Israel's 120-seat parliament with 17 seats and four ministers.


Ehud Barak Mr Barak needs firm political support for the next round of Mid-East talks
Its departure would leave Mr Barak with just 51 seats, well short of a parliamentary majority, although the prime minister can count on the support of another 10 MPs, mainly from Arab parties.

The $53bn budget for 2000 faces a final parliamentary vote this week, a key political test for Mr Barak before he leaves for the United States for the next round of negotiations with Syria on 3 January.

Mr Barak is looking for political backing in an Israel deeply split over Syrian demands for the return of all of the strategic Golan Heights, captured in the 1967 Middle East war.

"We are going into one of the most important processes since Israel was founded, and we want Shas with us," said Binyamin Ben-Eliezer, one of Mr Barak's cabinet ministers who worked through the night to try to persuade Shas to reconsider.

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See also:
27 Dec 99 |  Middle East
Barak's majority under threat
22 Dec 99 |  Middle East
Barak resumes talks with Arafat
15 Dec 99 |  Middle East
Analysis: The Lebanon factor
14 Dec 99 |  Middle East
Barak delivers security pledge
27 Aug 99 |  Middle East
Sabbath row settled

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