NETANYAHU GETTING TO CRUNCH TIME

C O N F I D E N T I A L SECTION 01 OF 02 TEL AVIV 000646 SIPDIS E.O. 12958: DECL: 03/18/2019 TAGS: PREL PGOV IS SUBJECT: NETANYAHU GETTING TO CRUNCH TIME Classified By: Political Counselor Marc J. Sievers for reasons 1.4 (b), (d). ¶1. (C) SUMMARY. Prime Minister-designate Binyamin Netanyahu is nearing the first "deadline" he faces in forming a governing majority in the Knesset. The Likud leader prefers to have coalition pacts signed prior to Sunday, March 22, which would guarantee him a majority in the Knesset, but he could request from President Shimon Peres an additional 14 days in which to conclude those coalition deals. He has reached an agreement with the Yisrael Beitenu party, but talks with SHAS have been unexpectedly lengthy, and his other allies on the right are also likely to bargain hard for their demands. Embassy contacts and Israeli press report that Likud representatives are working intensively with Kadima and Labor representatives to try to persuade one or both to join the coalition. End Summary. -------------- APPROACHING THE (FIRST) DEADLINE -------------- ¶2. (SBU) Netanyahu this week reiterated his desire to form his coalition before the expiration of the 28-day period allotted by the Basic Law. The precise date that falls on, originally thought to be March 20, is the focus of some debate in Israel. Netanyahu's camp sought a legal opinion from the President's office, which determined that the date President Peres tapped Netanyahu to form a government is not included in the tally. If this opinion holds, the deadline to form a government would now be Sunday, March 22 (since March 21 is Shabbat). President Peres can extend the deadline for up to another 14 days, but Netanyahu may be concerned that an extension would make it appear that he will not be able to effectively manage his coalition partners. Netanyahu probably would be willing to risk that perception, however, if he were confident that an extension would enable him to form a government that included Kadima and/or Labor. -------------- AGREEMENT SIGNED WITH YISRAEL BEITENU; OTHER AGREEMENTS PENDING -------------- ¶3. (SBU) Netanyahu on March 15 signed an agreement with senior coalition partner Yisrael Beitenu, giving its chairman Avigdor Lieberman the Foreign Ministry portfolio, and setting aside for his party the Internal Security, Infrastructure, Tourism and Absorption ministries, and the chairmanship of the Knesset Constitution, Law, and Justice Committee. Notably, the agreement specified that each party was interested in creating a "unity" government and that portfolios would be redistributed should such a government be formed. Negotiations with the sephardic ultraorthodox (haredi) SHAS party, however, have been surprisingly difficult. SHAS and Likud reportedly went into the February elections having reached some understandings on what their partnership would look like, which suggested to us that negotiations would be relatively smooth. Netanyahu has met with SHAS leader Eli Yishai over the past several days, but talks have stumbled over planned real estate reforms to alleviate the housing shortage in the haredi sector, budgets for religious education institutions, and the question of whether or not SHAS would be given a minister in charge of haredi education. Netanyahu is reportedly prepared to offer SHAS the Interior (Yishai),Religious Affairs, and Housing and Construction ministries. Negotiations with Likud's other "natural partners" - United Torah Judaism, National Union, and Jewish Home - also could prove difficult, as these parties are fighting over some of the same portfolios that are slated to go to SHAS and Likud, and some have felt slighted that Netanyahu is engaging with them only now. -------------- UNITY STILL A POSSIBILITY -------------- ¶4. (C) Netanyahu confidant and incoming chairman of the National Security Council Uzi Arad told PolCouns on March 18 that Likud representatives are continuing intensive contacts via multiple channels with Kadima and Labor in an effort to build a broad-based government. Israeli press also detailed the talks, reporting that Netanyahu had offered Labor five portfolios and two deputy minister roles, and commenting that Netanyahu has spent as much time negotiating with parties to his left as he has with those on his right. Arad stressed that from his perspective a broader government is much better for Israel diplomatically and strategically. He added that Netanyahu had not decided whether to request an extension from Peres, but said he would do so only if he thinks he absolutely needs the extra time to achieve a broader government. Arad said that Netanyahu at this point plans to TEL AVIV 00000646 002 OF 002 inform Peres before Shabbat, which starts the evening of March 20, that he has an agreement with his rightwing partners, giving him a majority in the Knesset. Once he informs the President, the Speaker of the Knesset must convene the Knesset within seven days to hold a vote of confidence in the new government. This additional week would enable Netanyahu to make one final attempt at negotiations with Kadima and Labor without having to request an extension. ********************************************* ******************** Visit Embassy Tel Aviv's Classified Website: http://www.state.sgov.gov/p/nea/telaviv ********************************************* ******************** CUNNINGHAM