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The battle between Prime Minister Ehud Olmert and Foreign Minister Tzipi Livni following the release of the Winograd Committee's interim report is reaching a boiling point: Olmert is expected to warn Livni at a meeting between the two today that she cannot continue to undermine him and still hold her position as deputy premier.

The prime minister and his aides were highly critical last night of what they said was Livni's open and active role in efforts within Kadima to remove Olmert.

"Tzipi always claims to be clean, nice and fair, but she is doing something that is unacceptable: a senior minister, who serves as deputy prime minister, is undermining him [Olmert] openly and working - through her associate, faction head MK Avigdor Yitzhaki - to recruit MKs who will vote no-confidence against him in the faction," an aide to Olmert said. "In no properly functioning government in the world would such a phenomenon be acceptable. If Livni wants to undermine [Olmert], she should resign and carry out her plans as an MK."

Senior Kadima MKs affiliated with Olmert recalled yesterday that former prime minister Benjamin Netanyahu fired Yitzhak Mordechai in 1998 because Mordechai was busy establishing the Center Party while still occupying the post of defense minister as a Likud MK. Olmert and his aides believe that his political survival, at this stage, depends on identifying the source of the rebellion within Kadima, rather than focusing on public opinion.

Sources in Livni's bureau denied yesterday that the foreign minister was in any way involved in Yitzhaki's efforts to rally Kadima MKs against Olmert.

However, sources in Kadima affiliated with Livni said that she intends to tell Olmert - perhaps even during their meeting today - that he should resign, since he has lost the support of the public. These sources also maintained that Livni intends to resign, taking into consideration that her time as foreign minister is probably limited anyway because Olmert is not likely to be in power for much longer.

But other senior sources in Kadima said the Livni is still debating whether to resign or strongly criticize Olmert, and that she is still open to the possibility of him leading efforts at reform.

Some Kadima sources said that if Livni resigned, she would receive broad public support, and this would increase her chances of taking over the premiership and the leadership of Kadima from Olmert.

Meanwhile, Olmert will present the cabinet today with a proposal to "adopt the main points of the Winograd report" and work toward implementing of its recommendations. Under this proposal, the government will set up a task force, headed by a retired defense official, which will flesh out the committee's recommendations for improving the decision-making process on diplomatic and security issues. In line with the report's recommendations, the task force will propose ways of bolstering the National Security Council, broadening the Foreign Ministry's involvement in decisions on foreign affairs and security issues and keeping the ministers better informed.

The group will be asked to formulate a plan and present it within 30 days. A special ministerial committee headed by the prime minister will then approve these proposals and supervise their implementation. In addition to Olmert, the committee will include Livni, Vice Premier Shimon Peres, Defense Minister Amir Peretz and Ministers Shaul Mofaz, Eli Yishai and Avigdor Lieberman.

Also yesterday, the Labor Party's secretary general, Eitan Cabel, resigned his post as minister without portfolio and announced that he will convene the party's central committee next week in order to discuss Labor's withdrawal from the coalition. Cabel, who is affiliated with Ehud Barak's camp in Labor, announced at a press conference yesterday morning that he "can no longer sit in a government led by Ehud Olmert" and called on Olmert to resign. (See full story, Page 2)