Shas's fast-growing young constituency is desperate for housing, so this waiver is critical for the party.
Olmert pledged to coalition partner Shas that he would not discuss the city with the Palestinians.
Yisrael Beitenu, as well as Shas and United Torah Judaism, are all likely to oppose it there.
ECONOMIST: The prime minister bows again to the religious right
Mr Netanyahu was forced to give up his alliance with the ultra-Orthodox parties: Shas and United Torah Judaism.
At a mass rally in Jerusalem on September 27th, Mr Yishai was formally installed as Shas's new leader.
Two religious parties, Shas and United Torah Judaism, got 11 and 7 respectively.
The Labour amendment to delay the abolition of SHAs was rejected by 202 votes to 170, a majority of 32.
He wants a forthright and irrevocable commitment from the rabbi who leads Shas to support him throughout the Palestinian negotiations.
Olmert obfuscates the truth because his political stability rests in the hands of his hawkish coalition partners Yisrael Beiteinu and Shas.
He added that the abolition of SHAs had already been postponed by a year, allowing "enough time for a safely managed transition".
The resignation of Aryeh Deri from the leadership of the 17-member Shas party opens the way for a broad Israeli coalition government .
On January 7th, he dutifully donned a black skull-cap for a reverential photo-opportunity with Rabbi Ovadia Yosef, spiritual leader of the powerful Shas party.
Will Netanyahu form a right-wing coalition with Jewish Home and religious blocs like Shas -- which earned between 11 and 13 seats, exit polls show?
Strategic health authorities (SHAs) were created by the previous Labour government in 2002 to manage local NHS services on behalf of the secretary of state.
The latest effort to tip things the religious way comes from Eli Yishai, leader of the largest Orthodox party, Shas, who is minister of the interior.
ECONOMIST: Another row between the religious and the secular in Israel
The ultra-Orthodox Shas party, a pivotal part of the government's coalition, has given notice that it will walk out if there is any negotiation over Jerusalem.
Ehud Barak's coalition government in Israel wobbled after the ultra-Orthodox Shas party said it would pull out after a row over money for its religious schools.
Ronnie Bar-On, the finance minister, a senior backer of Ms Livni in the Kadima contest, says the global financial upheaval is reason enough to reject Shas's demand.
From Shas, Mr Barak wrung the reluctant retirement of that party's powerful chairman, Aryeh Deri, who has been convicted of taking bribes and faces a prison term.
But now that he is in control, he finds himself still constrained by Shas and by the prime minister's overriding concern not to lose Orthodox voters' support.
He wanted Shas in his government, he explained in 1992, so that his peace overtures would not have to depend on the support of the Arab parties.
Deputy leader of Labour peers Lord Hunt of Kings Heath called on the government to delay abolishing SHAs until all their functions were being undertaken by another body.
Had they entered a Livni government without securing a pledge to defend Jerusalem, Shas would have been hard pressed to compete with the Likud in the coming elections.
Rabbi Ovadia Yosef, the spiritual leader of Shas, one of Israel's religious parties, has long indicated that he would be in favour of giving up land for peace.
They also serve to weaken Shas among its non-ultra-Orthodox voters.
Lord Hunt argued that "there is going to be a glaring lack of strategic leadership across a local health economy" if SHAs were abolished at the time that the government intended.
The principle he seeks to uphold is that the schools run by the Shas party, another coalition partner, cannot get more money from his ministry unless they institute rigorous administrative reforms.
His aides have given warning that he would dissolve the Knesset and call early elections if the Labour and Shas parties, his main coalition partners, persist in opposing an austerity budget.
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