Defense Minister Amir Peretz will continue to cooperate with the prime minister on matters of state, sources close to the defense minister and the Labor Party chair said yesterday. The statement was made following reports that Olmert was planning on firing Peretz and replacing him with former prime minister Ehud Barak. Olmert's bureau said the prime minister had no intention of dismissing Peretz.

Peretz has avoided raising tensions between himself and Olmert, since he reportedly believes, among other things, that Olmert is politically unable to fire him. Some Labor MKs and ministers have said that although they, too, are calling for him to resign as defense minister, they will not lend a hand to his dismissal, which would, they said, be tantamount to interfering in internal Labor matters. Among those voicing this opinion are MKs Benjamin Ben-Eliezer, Eitan Cabel and Isaac Herzog. MK Ami Ayalon, who is running against Peretz in the primaries for party chair, said, "We are in the midst of elections for the chairmanship and I will not lend a hand to the appointment of a defense minister in an improper fashion."

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Labor officials believe Olmert will wait a few more weeks before moving to replace Peretz, and even then he will have to do so with Peretz's agreement and not unilaterally, which Labor will not support. Peretz has transmitted messages to Olmert that if he tries to move him, Olmert will do himself damage. Officials say Olmert will probably wait for a verdict in the Ramon affair and developments in the Winograd Committee before significantly reshuffling cabinet posts.