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Likud leaders have warned Shas that the Sephardi, ultra-Orthodox party will not be part of any future Likud government if it supports an alternative administration headed by Kadima.

"If Shas betrays Likud again, it will remain outside Benjamin Netanyahu's government when we return to power," a senior Likud source told Haaretz.The source was referring to Shas' "betrayal" in 2000, when the party voted against Likud leader Benjamin Netanyahu's demand to dissolve the Knesset and move up elections. Shas' vote led to Ariel Sharon's becoming prime minister.

Senior Likud figures have made it clear to Shas that Likud will "not forgive or forget" if Shas gives its support to Minister Shaul Mofaz if he is elected Kadima chairman. Supporting Mofaz would cause an irreversible rift between Shas and Likud and end the alliance between them, the Likud sources said.

Likud's warning came in response to Shas leaders' recent statement that if Mofaz is elected Kadima leader and reinstates the child allowances that Netanyahu slashed when he was finance minister, Shas will join his government. Mofaz has indeed promised to reestablish child allowances.

Netanyahu himself said a few days ago that he would consider reintroducing lower child allowances "because there's money in the till."

However, Likud people told Shas this week that even if Olmert agrees to reinstate child allowances and Shas revokes its support in dissolving the Knesset, Likud would never support reinstating the allowances.

Netanyahu was lambasted in Likud for suggesting to reestablish child allowances and has since retracted his statement.

"Does Shas really think that if it gets child allowances from Olmert, we would support it in the Knesset, thus enabling Olmert's government to stay intact? We haven't gone crazy," a Likud source said. "Shas is fighting a hopeless battle."

The various parties have been discussing the option of an alternative Kadima-led government if Olmert resigns and the winner of a Kadima leadership primary takes his place. A vote to dissolve the Knesset is expected to take place next Wednesday.

Although Kadima is the largest party, Labor intends to present a candidate of its own for prime minister, said Agriculture Minister Shalom Simhon (Labor), a close associate of the Labor Party leader and defense minister, Ehud Barak.

"If we have to go to the president, Kadima will not be the only one trying to form a government," Simhon said this week.

He said Barak could not head a government in the present Knesset because he was not a Knesset member. However, Labor may suggest to the president another minister as a candidate for the alternative government, such as Isaac Herzog, Benjamin Ben-Eliezer or Simhon.

"We don't have to support Kadima's candidate and give it an advantage in the next elections," Simhon said. "At the same time, they [Kadima] can also support our candidate."