Olmert gets cabinet nod for far-right partner

JERUSALEM, Oct 30 (Reuters) Israeli Prime Minister Ehud Olmert won cabinet approval today for a far-right faction to join the government, a partnership likely to complicate any attempts to revive Israeli-Palestinian peace efforts.

The Yisrael Beitenu party, led by Avigdor Lieberman, advocates annexation of parts of the occupied West Bank and jurisdictional transfer of several Arab towns in Israel to a future Palestinian state.

All but one cabinet member voted in favour of membership, Israel Radio said, after Olmert's main coalition partner, the left-leaning Labour party led by Defence Minister Amir Peretz, decided yesterday to remain in the government despite its differences with Lieberman.

Winning Lieberman's support while keeping Labour at his side marked a reversal of fortunes for Olmert, whose popularity, along with Peretz's, has plummeted in opinion polls since last summer's indecisive war against Lebanese Hezbollah guerrillas.

Yisrael Beitenu's 11 legislators will give Olmert's coalition control of 78 seats in the 120-member parliament -- a particularly strong majority in Israeli politics. Parliament was set to approve the expanded government later in the day.

With prospects poor for a renewal of West Asia peace efforts any time soon, there appear to be few issues ahead that could divide the new Israeli alliance.

Olmert has wide backing at home, and from the United States, for his refusal to engage in any dialogue with a Palestinian government led by Hamas until the Islamist group recognises Israel and existing interim peace deals and renounces violence.

Nabil Shaath, a senior member of Palestinian President Mahmoud Abbas's Fatah party, called Lieberman ''a dangerous creature'' and said his inclusion in the cabinet was ''an ugly symbol of the direction this Israeli government is taking''.

SHIFTING FOCUS Shifting Israel's public focus towards fears of a nuclear Iran, Olmert announced after the 34-day Lebanon war ended in August that the ''realignment'' plan on which his centrist Kadima party won election in March was no longer a pressing issue.

The proposal, opposed by Israel's right wing, called for the dismantling of dozens of Jewish settlements in the West Bank, while strengthening others in the absence of peacemaking with the Palestinians.

Taking it off the agenda helped pave the way for Lieberman, himself a settler, to join the coalition.

Many Israelis, shocked by Hezbollah's launching of nearly 4,000 rockets at northern Israel from territory Israeli forces quit in 2000, fear that West Bank pullbacks would leave the centre of the Jewish state vulnerable to Palestinian attack.

Olmert has given Lieberman, who will be one of his deputy prime ministers, special responsibility for strategic issues, Israeli shorthand for Iran's nuclear programme which Israel and the West fear Tehran will use to build atomic weapons.

The Islamic Republic, whose president has called for Israel's destruction, says it is enriching uranium only to generate electricity.

Lieberman, a 48-year-old immigrant from the former Soviet Union who once worked as a night club bouncer, founded his party, whose name translates as ''Israel Our Home'', in 1999. He has served twice as a cabinet minister.

REUTERS SP VV1815