Charedim out as ground-shaking deal is brokered

It came down to the wire but at the last moment, a coalition has almost certainly been formed in Israel, five weeks after Benjamin Netanyahu was first called to President Shimon Peres and nearly two months after the elections.

The agreement between the three main coalition partners, Likud Beiteinu, Yesh Atid and Habayit Hayehudi, keeps the Charedi parties out of government for only the second time in three decades and creates one of the smallest cabinets in recent Israeli history.

The last sticking points were ironed out on Wednesday evening. Mr Lapid insisted until the last moment on his party holding the influential education and interior ministries but at the end of the day agreed to compromise with the Likud and accepted just the education portfolio, which will go to his number two, Rabbi Shai Piron.

Mr Lapid will serve as finance minster in the new government which, while being one of the main cabinet posts, was not what he wanted. He was not given the coveted Foreign Ministry by force of Mr Netanyahu’s agreement with his number two, former foreign minister Avigdor Lieberman. The prime minister will be in charge of the Foreign Ministry until Mr Lieberman’s court case is over.

Habayit Hayehudi agreed to receive only three ministries in the new government as part of the move to have only 21 ministers in cabinet, but will hold also the powerful Knesset Finance Committee. Mr Bennett will be a deputy prime minister and serve as the Trade, Industry and Employment Minister.

Both leaders, who together drove an extremely tough bargain with Mr Netanyahu, are seen as having made significant gains in the coalition negotiations. For a start, they managed to stick together despite significant policy differences and insisted on a government without the Charedi parties and without a bloated number of ministers.

The absence of the Charedi ministers will make it easier to achieve electoral reform, push through a national service law and make some drastic changes into the way social entitlements and housing benefits are distributed.

The electoral reform clause in the coalition agreement, boosting the electoral threshold in the next elections to four per cent, is an attempt to minimise the number of parties in the Knesset and make Israel’s political structure more stable. It will force small parties to unite — for example, the three Arab parties in the Knesset will no longer be able to run separately.

The new government is no more to the right or left than the one that emerged from the previous elections in 2009. Yesh Atid are now filling the balancing role on the centre-left that Labour did then and, on the right, there is a larger Habayit Hayehudi, but no Shas, the Charedi party that was always on the right of most issues.

It is hard to see this government embarking any time soon on a new diplomatic initiative with the Palestinians, even though Tzipi Livni has been appointed chief negotiator. Ms Livni’s other new position though, as Justice Minister, is more significant: she will be in a position to block most right-wing law proposals, seen by many on the left as designed to limit free speech.

Mr Netanyahu is about to start his third term as prime minister, his party weakened while he has been forced to share power with two young rivals who make little effort to try to hide their aspirations to replace him in the not too distant future. A difficult beginning.

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