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Prime Minister Ehud Olmert is expected to announce by tomorrow the appointment of Roni Bar-On, currently the interior minister, to head the Finance Ministry.

Associates said Olmert made the decision over the weekend, but he is holding off on making a formal announcement until he has decided on the other expected cabinet appointments, primarily that of MK Haim Ramon, who will have to forgo the treasury.

Yesterday Olmert's deputy chief of staff, Oved Yehezkel, and the outgoing cabinet secretary, Yisrael Maimon, met with Ramon to discuss the array of jobs he will be given. Ramon is slated to become vice premier in place of President-elect Shimon Peres, a minister in the Prime Minister's Office with responsibility for political affairs, as well as a key position in Kadima as part of the plan for rebuilding the party. Ramon will also be a member of the political-security cabinet and participate in other restricted forums alongside the prime minister.

Ramon is reportedly inclined to accept the offer and is expected to meet with Olmert tomorrow to finalize his areas of responsibility and the substance of his post. He will be a member of Olmert's inner circle and exercise influence over major processes Olmert conducts.

In conversations between Olmert and Ramon over the past two days, Olmert made it clear he will do everything to keep Ramon beside him in the cabinet, and told him that Kadima needs him.

Olmert's decision to pick Bar-On, known to be one of his closest political allies, stemmed, among other reasons, from concern that appointing Ramon as finance minister would provoke a public outcry and petitions to the High Court of Justice because of his conviction for indecent assault. That consideration was given more weight by the sweeping public condemnation of the public reaction to the plea bargain reached with outgoing president Moshe Katsav.

Sources close to Olmert say that a court petition will likely be filed in connection with Ramon's appointment, but that criticism will be less than were he to get the treasury. In any event, his appointment to a senior cabinet posting will survive a court challenge, they say.

According to Olmert associates, the talks with Ramon were amicable, informed by Ramon's deep appreciation for Olmert's unqualified support throughout his police investigation and the trial. While disappointed at not being appointed finance minister, they said, Ramon understands that Olmert wants him in the most senior and influential posts by his side.

Olmert and his aides have also been occupied with the other expected appointments in Kadima. Olmert's reshuffled cabinet, to be unveiled Wednesday, is expected to herald a new era for Olmert and his party after a crisis-filled year. The greatest disappointment is reserved for Housing Minister Meir Sheetrit, who was hoping that Olmert would compensate him this time by appointing him finance minister, after having refrained from doing so in the last round of appointments, when he gave the job to close ally Abraham Hirchson. Sheetrit lost no opportunity to let Olmert know that he is the most suitable candidate for the post, since he held it in the past.

Olmert is considering offering Sheetrit the interior portfolio, amid warnings not to place control over local authorities in the hands of Sheetrit, who plans to run for the leadership of Kadima and will naturally use the office to political advantage.

The other candidates for interior minister are Minister without portfolio Jacob Edery and MK Ruhama Avraham, who chairs the Knesset House Committee.