Alternate Prime Minister Benny Gantz has agreed to curb Justice Minister Avi Nissenkorn's powers, sources said, in bid to stave off election.
In return, Gantz hopes to cement the rotation agreement for the premiership with Prime Minister Benjamin Netanyahu is upheld.
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The law states that if the Knesset doesn't pass a state budget by Tuesday, Israel will head for another round of elections, the fourth in two years.
According to the deal, Nissenkorn, a lawmaker from Benny Gantz's Kahol Lavan party, would lose his powers as Justice Minister in exchange for revoking the law stating that the Knesset would automatically dissolve if a 2020 state budget is not passed by the December 23 deadline.
On Sunday evening, some 300 anti-government activists protested near Gantz’s home in the central city of Rosh Ha’ayin, accusing him of surrendering to Netanyahu’s wishes and “destroying what is left of Israel’s democracy.” A coalition of protest groups urged Gantz and lawmakers from his party to refuse any compromise with the prime minister.
Arye Dery, Shas chairman and cabinet member, said on Sunday "I have a reason to assume the Knesset won't dissolve this week, but December 23 is still that date we're looking at."
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According to the compromise Gantz agreed to, the government will be presented with a shortlist of five candidates to select the next state prosecutor. This widens the options from Kahol Lavan's preferred pick, Haifa District Prosecutor Amit Aisman.
The compromise also calls for the establishment of a joint committee to appoint a new attorney general, in addition to a new joint committee that will be responsible for choosing advisers, which effectively replaces the existing search committee.
The compromise would also include an amendment to the Judicial Appointments Law for appointing a justice to the Supreme Court. The amended law will require a majority of eight members of the committee to appoint justices instead of the current seven. This will give Netanyahu loyalists, Transportation Minister Miri Regev and lawmaker Osnat Mark veto power over the appointment.
Gantz claims that the deals will ensure the rotation of the premiership because Netanyahu cannot use the budget as an excuse to head for an election.
According to sources, Gantz and Likud have agreed to the details, but the agreement faces opposition from within Kahol Lavan, including by Foreign Minister Gabi Ashkenazi, since it would mean that the justice portfolio would be transferred to Likud's hands.
It is unclear how Gantz will win the consent of Kahol Lavan’s legislators to advance the arrangement. A Kahol Lavan official said: “Gantz is having an anxiety attack. He is prepared to butcher the justice system for another five months in the Defense Ministry.”
Likud is still waiting for a response from Kahol Lavan. Any agreement reached by Likud and Kahol Lavan will need to be legislated, and there isn't much time left before the looming December 23 budget deadline.
Kahol Lavan said in response that the reports are false. "Internal conflicts belong in other parties," read a statement. "We will not compromise on maintaining a functioning government while safeguarding democracy and the rule of law, as well as ensuring a state budget to take care of the economic coronavirus," the statement added, calling to "stop with the lies."
Bar Peleg contributed to this story