* Deal seen creating biggest coalition in Israeli history
* Broad coalition comes as Israel ponders Iran challenge
* Netanyahu hopes Palestinians seize opportunity for talks
(Adds Mofaz comments, excerpts from coalition accord)
By Allyn Fisher-Ilan
JERUSALEM, May 8 (Reuters) – Israeli Prime Minister Benjamin
Netanyahu formed a unity government on Tuesday in a surprise
move that could give him a freer hand to attack Iran’s nuclear
facilities and seek peace with the Palestinians.
The coalition deal, negotiated secretly over the past days
and sealed at a private meeting overnight, means the centrist
Kadima party will hook up with Netanyahu’s rightist coalition,
creating a majority of 94 of parliament’s 120 legislators.
The coalition, which replaces plans announced just two days
earlier for a snap election in September, will be one of the
biggest in Israeli history.
“This government is good for security, good for the economy
and good for the people of Israel,” Netanyahu told a joint news
conference with Kadima’s leader, Shaul Mofaz.
The new coalition would focus on sharing out the duty of
military conscription among all Israelis, redrawing the national
budget and advancing electoral reform, he said.
Ultra-Orthodox parties in the coalition had opposed plans to
extend conscription to their supporters, who are now exempt.
“Lastly it is to try to advance a responsible peace process
… Not all has been agreed but we have a very strong basis for
continued action,” the prime minister said, adding that he hoped
the Palestinians would “spot the opportunity and come sit with
us for serious negotiations”.
“Of course one of the important issues is Iran,” Netanyahu
added in response to a question.
Environment Minister Gilad Erdan said the accord would help
build support for potential action against Iran’s atomic
programme, which Israel views as an existential threat.
“An election wouldn’t stop Iran’s nuclear programme. When a
decision is taken to attack or not, it is better to have a broad
political front, that unites the public,” he told Israel Radio.
A spokesman for Palestinian President Mahmoud Abbas called
on Israel to “use the opportunity provided by the expansion of
its coalition government” to expedite a peace accord.
“This requires an immediate halt to all settlement activity
throughout the Palestinian Territories,” spokesman Nabil Abu
Rdainah said. “The new coalition government needs to be a
coalition of peace and not a coalition for war.”
Peace talks have been suspended for 18 months in a dispute
over Jewish settlement building in the occupied West Bank and
Palestinians say they cannot resume unless such construction is
frozen. Netanyahu has called for talks without preconditions.
“Entering peace negotiations was an iron condition for
forming the unity government,” Mofaz said.
The coalition accord says the new administration will “work
towards the resumption of the peace process and promoting talks
with the Palestinian Authrotity”.
But it also noted “the importance of maintaining defensible
borders”, a phrase Netanyahu has used in the past to deflect
Palestinian demands for extensive Israeli withdrawal from the
West Bank, territory captured in a 1967 war.
SIGNAL TO IRAN
Under the coalition accord, Mofaz, a former defence
minister, will be named vice premier in the new government. He
took over leadership of the Kadima party in March from Tzipi
Livni.
As deputy prime minister in a former Kadima-headed
government in 2008, Mofaz was among the first Israeli officials
to publicly moot the possibility of an attack on Iran.
But the Iranian-born Mofaz has been more circumspect while
in opposition, saying Israel should not hasten to break ranks
with world powers that are trying to pressure Iran through
sanctions and negotiations.
Gerald Steinberg, political scientist at Bar-Ilan University
near Tel Aviv, said the coalition deal “sends a very strong
signal to Tehran, but also to Europe and the United States, that
Israel is united and the leadership is capable of dealing with
the threats that are there if and when it becomes necessary”.
Israeli officials say the next year may be crucial in seeing
whether Iran will curb its nuclear plans in the face of
international condemnation and Western sanctions. Iran will
discuss its nuclear programme with major powers on May 23.
Israel has regularly hinted it will strike the Islamic
republic if Tehran does not pull back. On Tuesday, Iranian
foreign ministry spokesman Ramin Mehmanparast dismissed the
threats of attack as “propaganda”.
Iran regularly rejects Israeli and Western accusations that
it is working on developing a nuclear bomb, saying its programme
is focused on generating electricity and other peaceful
projects. Israel is widely assumed to have the Middle East’s
only nuclear arsenal.
“PREPOSTEROUS ZIGZAG”
The next election was due in October 2013 but Netanyahu had
pushed this month for an early poll after divisions emerged in
his coalition over the new military conscription law. Parliament
was preparing to dissolve itself and clear the decks for a Sept.
4 ballot while the backroom talks with Kadima were under way.
“When it turned out it was possible to set up the biggest
government in Israel’s history … I thought we could restore
stability without elections, so I decided to set up a broad
national unity government,” Netanyahu said.
The accord stunned the political establishment and drew
swift condemnation from the centre-left Labour party, which had
been touted in opinion polls to be on course for a resurgence at
the expense of Kadima.
“This is a pact of cowards and the most contemptible and
preposterous zigzag in Israel’s political history,” Labour party
leader Shelly Yachimovich was quoted as saying in the media,
where commentators hailed Netanyahu’s political prowess.
Kadima, with 28 seats, will add significant weight to the
coalition, but it remains uncertain how it will get along with
religious and ultra-right parties also in the cabinet.
Inter-government relations are likely to be tested swiftly
over the issue of settlement building after the high court
ordered the government on Monday to demolish five apartment
buildings in a Jewish settlement in the occupied West Bank.
Many Netanyahu supporters want him to adopt legislation to
legalise settlements, such as the Ulpana apartments, which a
court has ruled were built on privately owned Palestinian land.
It is not clear if Kadima would support such a move, which
would draw international condemnation on Israel.
(Additional reporting by Ari Rabinovitch; writing by Jeffrey
Heller; Editing by Douglas Hamilton and Philippa Fletcher)
