Prospects Brighten Considerably for Formation of Unity Government

Prospects for a Labor-Likud unity government, which had faded over the weekend, brightened considerably today following a meeting between Premier Yitzhak Shamir and Premier- esignate Shimon Peres this morning at Shamir’s home. They are due to meet again this evening at the Knesset.

Peres told reporters after the morning meeting that all problems relating to a unity government’s policy platform had been ironed out and that the two leaders are now dealing with the structure and composition of the proposed new government.

Shamir, more circumspect, stressed that “some formulation work” was still needed. But he left no doubt that a deal had been struck.

At the Knesset, a Labor-Likud working group of lawyers and politicians haggled among themselves and with representatives of their respective “satellite parties” over the allocation of Cabinet portfolios. To veteran political observers, that activity was the strongest possible proof that agreement had been reached between Shamir and Peres and a unity regime is sure to emerge.

ACCORD ON KEY ISSUES

Political sources claimed today that the two leaders had reached agreement on key issues: Labor and Likud will each have 10 ministers in the unity Cabinet — not 12 as originally proposed. The remaining seats in what will probably be a 24-member Cabinet will be allocated to smaller parties in a way that will not affect the parity between Labor and Likud.

For example, if Shash, a new religious faction allied with Likud, is awarded a seat, a seat will also go to Labor’s ally, Shinui.

The Premiership will be held by Peres for the first 25 months of the new government’s tenure with Shamir serving as Deputy Premier and Foreign Minister. The positions will be reversed during the second half of the four year and two month period before the next scheduled elections.

Laborite Yitzhak Rabin will serve as Defense Minister for the full term of the government. Likud will hold the Finance Ministry, the Justice Ministry–probably with incumbent Moshe Nissim staying on–and the Housing Ministry, apparently with incumbent David Levy remaining in office for the full term.

Labor is to get the Education Ministry, a portfolio believed likely to go to former President Yitzhak Navon, and the Ministry of Agriculture. Labor sources said Shamir agreed to this despite the fact it is coveted by former Defense Minister Ariel Shar on as a base for which to fight for more settlements on the West Bank.

PROBLEMS OF NRP PARTICIPATION

Problems surround the participation the National Religious Party, one of the strongest advocates of a unity government, which is credited with helping to broker the deal between Labor and Likud.

The NRP, with four Knesset mandates, is demanding two Cabinet seats. Both Labor and Likud would prefer to limit it to one. The NRP insists on keeping the Religious Ministry which Likud has pledged to Shas, a new religious faction, also with four Knesset seats, which represents a Sephardic constituency.

Shas leader Rabbi Yitzhak Peretz said today that his party was better suited for the religious portfolio than any other, “given our political inexperience.”

But the NRP’s new strongman, Rafael Ben-Natan, argued that his party with its close control of the Chief Rabbinate would maintain “national” doctrines and traditions whereas “others” would undermine them. He implied that Shas was ideologically close to anti-Zionist circles among ultra-Orthodox Jews which have traditionally opposed the Chief Rabbinate as the nation’s spiritual authority.

Another problem with the NRP is whether its minister will have to be balanced by a pro-Labor minister, given the religious party’s hardline position on settlements which favor Likud policy.

That problem may be side-stepped if it is resolved that questions relating to settlement activity are to be dealt with by an “inner cabinet” consisting entirely of Labor and Likud ministers. The inner group would endeavor to reach consensus on key policy issues before submitting them to the full Cabinet. It would have 8-10 members.

AGUDA SIGNS ACCORD WITH LIKUD

The Agudat Israel Party today signed the agreement it negotiated with Likud last week, wresting from the latter a rather weak commitment to support religious legislation on such controversial issues as “Who is a Jew?” and archaeological digs.

According to radio reports, Likud pledged that all of its MKs “except a few individuals” would back such legislation. Observers pointed out that the precise number of those “few” could determine the fate of controver sial bills.

TEHIYA WON’T JOIN UNITY GOVERNMENT

The ultra-nationalist Tehiya Party, which won five seats in the July 23 elections to emerge the third largest party in the Knesset, reiterated today its determination to stay out of a unity government because of what it alleged was a “sell-out” over settlements.

Tehiya’s leader, Yuval Neeman, who is in Australia, angrily condemned the Labor-Likud compromise on that issue, in a telephone message to his party. But the new rightwing religious faction, Morasha, with two Knesset seats, has proposed that it and Tehiya join a unity coalition on condition that the new government’s settlement policy is satisfactory.

West Bank settlement activists announced, mean-while, that they would go ahead with new settlements in defiance of any restrictions that might be imposed by a unity government.