PROBLEMS UNLIKELY TO IMPEDE EARLY JANUARY

C O N F I D E N T I A L TEL AVIV 006672

SIPDIS

E.O. 12958: DECL: 06/11/2013
TAGS: PREL PGOV KWBG IS GOI INTERNAL
SUBJECT: PROBLEMS UNLIKELY TO IMPEDE EARLY JANUARY
GOVERNMENT FORMATION


Classified By: Ambassador Daniel C. Kurtzer for Reasons 1.4 (B) and (D)
.


1. (C) Problems with prospective coalition partners Labor
and United Torah Judaism are delaying PM Sharon's efforts to
put together a viable coalition, but should not prevent
establishment of a new government in early January.
Negotiators are generating alternative mechanisms to give
Labor leader Shimon Peres a suitably august title and to give
UTJ the additional authority over its religious institutions
that party leaders seek. Sharon and Labor leader Peres both
continue to display confidence that they will bring together
a majority coalition.


2. (C) The Attorney General forced a backstep when he
chastised hard-racing negotiators for trying to change
overnight the country's constitution-like Basic Law to give
Peres an "acting prime minister" title like currently held by
Ehud Olmert. As a result, negotiators are now pursuing a
change to the separate "Government Law" that would give Peres
a "vice prime minister" title. The action leaves Olmert with
all of his current powers and retains his clear designation
as acting prime minister should Sharon to be incapacitated.
This proposal, or another with a similar aim, is likely to
speed through committee and full Knesset approval the week of
January 2.


3. (C) UTJ is having second thoughts over its "price" for
joining the coalition. UTJ leaders, who continue to decline
taking Cabinet seats, reportedly are now seeking a greater
degree of independence from the state education system for
their religious institutions. Observers indicate that
Sharon, who was willing to see the secular Shinui party leave
the coalition as the cost of bringing in a religious party,
will come up with a formulation that keeps UTJ in his new
majority coalition.


4. (C) Within his own party, Sharon faces continuing efforts
by disengagement foe Uzi Landau to derail the new coalition
-- and thus disengagement itself. Landau and about a dozen
other Likud MKs say they plan to vote against a
Likud-Labor-UTJ coalition. Sharon, however, requires only a
simply Knesset majority for government formation, and, with
expected abstentions, he appears to hold a 56-42 majority in
favor.


5. (C) The closer Sharon gets to the critical January
Cabinet vote on evacuation of settlements, the stronger the
motivation for Labor to have secured its seats at the Cabinet
table. As the disengagement vote approaches, so too does the
deadline for passing the budget, providing an incentive for
UTJ to sign on and secure the financial and other gains it
has negotiated as its price for joining the government. In
addition, the longer negotiations take, the more UTJ leaders
will face pressure to walk away from a coalition deal. Prime
Minister Sharon's Haredi (ultra-orthodox) affairs advisor,
Rivka Paluch, told the Ambassador this week that UTJ
spiritual leader Elyashiv is coming under pressure to not
join the coalition from settlers who are deluging him with
letters claiming severe emotional suffering by the children
of settlers scheduled for evacuation. Elyashiv also
reportedly fears that a Labor Party Minister of
Communications might liberalize laws regulating Internet
pornography.

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