Netanyahu, Lapid, Bennett agree to form coalition government

After countless bumps in the road and endless ups and downs, and after everything appeared to finally be settled, coalition negotiations hit another wall on Thursday — this time the clash was between Likud-Beytenu and Habayit Hayehudi.

Naftali Bennett, the chairman of Habayit Hayehudi, demanded the title of "deputy prime minister." According to Habayit Hayehudi officials, the Likud-Beytenu negotiations team had promised Bennett the title, but according to Likud-Beytenu, no such promise was made.

Representatives of the parties were scheduled to meet at around noon on Thursday to finalize the coalition agreements and officially sign them, in effect establishing a new coalition. But the representatives of Habayit Hayehudi refused to show up for the meeting, and only hours later explained that the crisis was over Bennett's deputy prime minister title.

Sources within Habayit Hayehudi hinted that Prime Minister Benjamin Netanyahu had pulled Bennett's title because of the years-long personal animosity between Bennett and the Netanyahu family, and that it was actually Netanyahu's wife, Sara, who instigated the move. (Bennett and Benjamin Netanyahu are rumored to have had a falling out several years ago over bad blood between Bennett and Sara Netanyahu).

Likud officials denied the allegations outright, with one official insisting that "this is baseless slander, and now the prime minister's wife is being dragged into it."

Another official explained that "the decision not to appoint deputies or vices to the prime minister applies to everyone, and during the coming term, no one will have such a title."

Later Thursday, negotiations between Habayit Hayehudi and Likud-Beytenu resumed, in efforts to resolve the outstanding issue. The meeting appears to have gone well, as Habayit Hayehudi dropped the demand for the title and officials are now saying that an agreement will be signed later Friday. The party will convene on Sunday to ratify the agreement.

Shortly before this last-minute crisis, at the start of the Likud meeting convened to ratify Yuli Edelstein's appointment to the position of Knesset Speaker, Netanyahu spoke about the coalition and its future tasks. "We are working out the final details so that next week we can present a new government to the people of Israel. The next term will be filled with challenges, but this government can meet these challenges," Netanyahu said.

"We [Likud] have regained the defense portfolio, and we held onto the foreign portfolio. The most important positions in terms of running the country are in our hands. The next term will be one of the most challenging in the history of the country. This is not an exaggeration — we are facing serious diplomatic and security threats," Netanyahu added.

Addressing his senior coalition partner, designated finance minister Yair Lapid, Netanyahu said that "the first task at hand for this new government is to protect the national budget so that we can preserve the progress we have made so far, and continue to ensure growth. I will provide full support for a responsible budget."

Earlier Thursday, Lapid wrote to his Facebook friends: "Well, looks like it's over. Or actually, just beginning. After we finalize the agreements I will provide more details and bring you up to speed. The dialogue between us on this page is part of the new politics in which elected officials don't close doors and disappear moments after getting the job."

The law stipulates that Netanyahu must declare to the president that he has assembled a coalition no later than Saturday night, and analysts surmise that the new government will be sworn in at the Knesset on Monday. After the swearing-in, a ceremonious cabinet meeting will also be held with the new cabinet members.

PM decides to dramatically reduce the diplomatic-security cabinet

Besides the significant cut to the total number of ministers in the next cabinet (at Lapid's behest), Netanyahu decided to additionally reduce the number of ministers in the smaller diplomatic-security cabinet — the close forum of ministers who advise the prime minister on diplomatic and security policy. Under Netanyahu's new decision, the diplomatic-security cabinet will comprise only the ministers that the law stipulates, plus the party heads and perhaps one additional Likud minister.

According to the law, the prime minister, defense minister, foreign minister, justice minister, public security minister and finance minister must be members of the diplomatic-security cabinet.

Judging by the near-final coalition agreements, these positions will be manned by Moshe (Bogie) Ya'alon (defense), Tzipi Livni (justice), Yitzhak Aharonovitch (public security), and Yair Lapid (finance). They will be joined by Bennett. This means that the cabinet could comprise only six members, as opposed to the 15-member cabinet in the last government.

Netanyahu has decided further that he will not appoint any ministers to serve as observers in the diplomatic-security cabinet. If Yisrael Beytenu Chairman Avigdor Lieberman is cleared of current charges against him and resumes the role of foreign minister, he will automatically become a member of the diplomatic-security cabinet.

Despite Lapid's insistence, Kadima will not join coalition

Kadima, which won two seats in the last election, is now officially in the opposition. Party Chairman Shaul Mofaz, who wanted to join the coalition, even met with Netanyahu as part of the coalition negotiations, but after one meeting decided to join the Bennett-Lapid alliance and severed contact with Likud-Beytenu. Mofaz hoped that the power of the three parties could give him enough leverage to demand the defense portfolio for himself.

Ultimately, the alliance collapsed, and while Bennett and Lapid preserved their mutual relationship and are now both in the coalition, Mofaz was left out because now the prime minister is refusing to invite him in.

At one point during the coalition talks, Lapid asked Netanyahu to invite Mofaz into the coalition, even offering to give up one of the ministerial positions promised to his party Yesh Atid in favor of Mofaz, but Netanyahu refused, stressing that he is not interested in having Mofaz as a member of the coalition.

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