Bad news from Israel

Shas is set to join Netanyahu's Likud-led coalition. Shas believes very adamantly in the West Bank settlement enterprise, which will therefore have now even less to fear from the Israeli government. In fact, as the report notes, a Shas member of the Knesset will be appointed housing minister in the new government. Meanwhile, Ehud Barak is willing to try to negotiate his way into Netanyahu's government, even if many in his Labor Party's leadership are opposed. If Labor does join, the odds of Netanyahu's government surviving go up tremendously - and the situation becomes even more complicated for US diplomats. Last update - 03:30 23/03/2009 Shas and Likud sign coalition agreement By Mazal Mualem, Haaretz Correspondent, Reuters and Haaretz Service The ultra-Orthodox Shas party signed a coalition agreement early Monday to join Prime Minister-designate Benjamin Netanyahu's government, according to Israel Radio. Shas lined up alongside Yisrael Beitenu as partners in Netanyahu's fledgling coalition. Likud secured a deal with the ultra-right-wing party earlier this month. Under the agreement, Shas will receive four portfolios in the new government. Party chief Eli Yishai will become interior minister, MK Ariel Atias will become minister of housing, Shas will also receive the new government's religion portfolio and a minister-without-portfolio in the Prime Minister's Office. "Israel is set to face many challenges, both social and economic and on the diplomatic and security front, as a result it is only right to combine forces and form a broad government," Shas leader Eli Yishai told journalists after the deal was signed. Likud legislator Gideon Saar, a member of Netanyahu's negotiating team, said the party would strive to broaden the coalition further in the coming days. "Now we have 53 lawmakers tied into coalition agreements headed by Benjamin Netanyahu and in the coming days we will work to broaden the parliamentary base for support for his government," Saar said. Coalition talks are scheduled to continue on Monday with Labor, United Torah Judaism and Habayit Hayehudi. Shas was also promised an increase of NIS 1.4 billion in child welfare payments. Shas and Likud on Sunday said that they had reached a compromise on the ultra-Orthodox party's demand for the education portfolio and on the appointment of an exclusive minister for ultra-Orthodox education in the next government, sources familiar with the negotiations said. United Torah Judaism was also said to have withdrawn its demand for the post of deputy education minister. Netanyahu, who served as prime minister from 1996 to 1999, faces an April 3 deadline to complete the formation of a government after being given the task last month by President Shimon Peres. Netanyahu is trying to recruit the center-left Labor party, which will conditionally open coalition talks later on Monday. Labor leader Ehud Barak, the outgoing defense minister, said he would ask his party's executive for a mandate to join Netanyahu's government when it meets on Tuesday. Barak issued a statement late on Monday saying he had appointed three allies to negotiate on Labor's behalf.