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Defense minister and Labor Party chairman Ehud Barak will demand from prime minister-designate Tzipi Livni that he conduct the negotiations with Syria if she forms a government. Labor sources also say Barak will demand to be fully involved in all aspects of the talks with the Palestinians.

Labor's Knesset faction will meet Thursday morning to formulate its demands in the coalition negotiations with Kadima, which are expected to start after the Rosh Hashanah holiday next week.

Barak will present the faction members with the main points from his meeting Wednesday with Foreign Minister Livni. She promised Barak a full and sincere long-term partnership in "managing the affairs of state" and retaining Labor's position as a senior partner in the government.

Meanwhile, two of Livni's most trusted advisers, attorney Yoram Raved and former cabinet secretary Yisrael Maimon, met with Meretz leaders to discuss their joining the new coalition. Meretz is also expected to decide today to officially open coalition negotiations with Kadima.

Shas chairman Eli Yishai also appointed a team to conduct talks with Kadima, and instructed it not to compromise over child allowances. Yishai ordered the team to discuss only social matters, and not deal with foreign-policy issues.

A senior Shas source said the coalition talks are no guarantee that Shas will in the end join a Livni government. "The appointment of the team does not mean the negotiations with Livni have become easier. The instructions they received were unequivocal - not to concede anything," the source said.

It seems Livni has decided to form a cabinet with Shas and Labor, senior Kadima sources said Wednesday. Because of the extremely close primary results and Kadima's internal problems, Livni understands she is not in a strong starting position if early elections are called. So she prefers to take advantage of the opportunity to become prime minister, said a senior Kadima source.

"Livni understands that polls are just polls," said the source. "Four hundred votes less, and Mofaz would be in her place. If she gives up on the option of a government now it could possibly be her biggest mistake. This means she will be willing to compromise even on child allowances."

Barak has yet to formally inform Livni of his demands in detail, but he is expected to do so as part of the negotiations between the two over forming a new government.

Barak feels the defense establishment must play a more central role in the negotiations with Syria, said a senior Labor Party source, due to the security implications of such a peace agreement.

Even in the days of prime minister Yitzhak Rabin, "the Foreign Ministry had almost no part in the negotiations with Syria," said a Labor source. "When Barak was prime minister and defense minister, he personally managed the contacts with Syria, even though then-foreign minister David Levy took part in the talks because Barak respected him."

It is impossible to conduct the Syrian channel in an "easy way," said a Labor Party source, implying that the manner Prime Minister Ehud Olmert managed the present indirect talks with the Syrians was not appropriate. Olmert used senior officials in the Prime Minister's Office - his former chief of staff Yoram Turbowicz and adviser Shalom Turgeman.

Barak's meetings with Livni have been conducted in a pleasant atmosphere, the sources said. However, a Labor source close to Barak said that despite this positive backdrop, "the coalition negotiations will not be simple."

Barak made it clear to Livni yesterday afternoon that he will not ask her to fire Justice Minister Daniel Friedmann, but he is firm in his position not to allow Friedmann to continue to harm the justice system. He says all future changes in judicial institutions must be made with Labor's assent.

In addition, Labor will demand the opening up of the budgetary framework.

Transportation Minister Shaul Mofaz's supporters in Kadima are demanding that Livni appoint him as her deputy and foreign minister.

Tourism Minister Ruhama Avraham Balila and MK Ronit Tirosh, both Mofaz supporters, met with Livni and told her that to unify the party after the primary, she should award Mofaz the posts because half of Kadima supports him.

Mofaz has yet to decide whether to return from his vacation, and may discuss a decision at a Rosh Hashanah meeting this evening in his home to thank key supporters for their support.