New political partners Prime Minister Benjamin Netanyahu and Kadima chairman Shaul Mofaz hailed their surprise coalition agreement as “historic” and “a source of “hope for Israel,” at a Knesset press conference on Tuesday afternoon.

Both men insisted the partnership was critical to the national interest. “We put the need for unity first,” said Mofaz.

The two said they could now advance a shared agenda that promoted consensual public interests, including the need to share the burden of national service, social reform, and progress on the diplomatic front. Both urged the Palestinian leadership to come back to the peace table. “I have some ideas over how to move forward” with the Palestinians, Mofaz said.

“Don’t rush to bury this (partnership),” Netanyahu told reporters who questioned the credibility and sustainability of the alliance. “I think I’m steering the state and my party effectively.” He added: “We’re going to achieve great things.”

The previous coalition had functioned well for three years, but had become increasingly hamstrung, he said. It would not have been capable of attaining agreement on new legislation for ultra-Orthodox national service, for instance. With the new, wider alliance, that would be possible.

“The State of Israel needs stability,” Netanyahu said, at the start of his remarks explaining the partnership. He said he had always wanted to maintain his coalition and while he had been prepared for early elections had that been necessary, he was pleased to sign an agreement with Mofaz that would restore stability. The new government represented “hope for all of Israel,” he said.

At this point, Netanyahu was interrupted by Meretz MK Nitzan Horowitz, who heckled him, saying that with the deal, “you have sunk to new levels of shamefulness.”

Netanyahu, unfazed, continued his address — talking about “historic opportunities” to legislate mandatory service for ultra-Orthodox Israelis, as well as opportunities to advance the peace process.

Mofaz, like Netanyahu, hailed the alliance as a “historic” achievement and opportunity for Israel. He cited four areas in which the 94-strong coalition could advance issues on which there is wide public consensus: national service for all, reform of the electoral system, maintaining a Jewish and democratic Israel, and willingness for territorial compromise in the cause of a viable accommodation with the Palestinians.

“This is the time for leadership that puts the national interest at center stage,” he said. “The prime minister and I will be judged by results and not by promises,” he said. “If it had been up to me, as you know, I would have joined a unity government three years ago.”

Mofaz denied he had a credibility problem, having pledged not to join the Netanyahu coalition. As the press conference ended, Kadima quickly corrected its website, which had hitherto highlighted party leader Mofaz’s vow not to negotiate with, never mind join, the Netanyahu government.

Answering reporters’ questions, Netanyahu denied that he had entered the alliance because he had lost control of his own Likud party, which has seemed to be drifting to the right.

Mofaz acknowledged that he had called Netanyahu “a liar” in the past. “We agreed to put that behind us,” he said, “for the good of the State of Israel.”

“It’s easy to sit in opposition,” said Mofaz. It was harder, but necessary, to take responsibility, in government, for the good of Israel. “My position on the need to join this coalition has been consistent,” he said, denying that he had a credibility problem. It had been “a mistake” not to join the coalition in 2009. “Today, we are correcting this mistake.”

Reporters asked Mofaz how he could influence government decision-making as the only Kadima minister in the government, drawing an answer that emphasized his confidence in Netanyahu as a partner who would honor their unity agreement. Mofaz said he had not sought to extort Netanyahu for Kadima’s benefit, and that the deal was designed for the wider national interest.

Netanyahu said he had twice asked former Kadima leader Tzipi Livni to join the coalition. “But she refused. I am very happy, very appreciative, that Shaul Mofaz accepted this overture.” This was “the time for unity,” he said. “This is a defining moment.”

He said his existing coalition partners had been extremely supportive, because “this unity is not a fiction… It is truly to strengthen Israel… at a time of immense regional upheaval.”

Labor’s Isaac Herzog, speaking earlier, said the shock deal would produce “so much revulsion” that it would work to Labor’s interest in the long term. “If we were heading for 17 seats [had early elections been held on September 4], we’ll get 27 [when elections are finally held as scheduled in late 2013]. Voters will return to their natural home.”

Critics mocked Mofaz for partnering with Netanyahu, having pledged repeatedly that he would do no such thing. He wrote on his Facebook page in March that he would not negotiate to join the coalition, and said more than once in public that his priority was to oust Netanyahu. His supporters countered that Kadima was heading for disaster had early elections been called, and that the new partnership was the only way to prevent Kadima’s near-obliteration.

Having gone to sleep with expectations of September elections, Israelis woke up to a new political reality Tuesday morning, learning that overnight, Netanyahu and Mofaz signed a deal to form a unity government.

Legislation to dissolve parliament was frozen after it had been approved on a first reading. The Netanyahu-Mofaz deal provides for this Knesset to see out its term, until October 2013.

Shortly after 2:30 a.m., Netanyahu and Mofaz arrived at the Knesset to brief their parties on the details of their secret agreement. Kadima joined the government in exchange for Mofaz’s appointment as a deputy prime minister, a minister without portfolio, and a cabinet member. No other Kadima members will join the government. The new coalition is one of the largest in Israel’s history, numbering 94 MKs.

Netanyahu and Mofaz speak at a committee meeting in the Knesset in January (photo credit: Miriam Alster/Flash90)

Netanyahu and Mofaz speak at a committee meeting in the Knesset in January (photo credit: Miriam Alster/Flash90)

The coalition agreement was being brought to the Knesset for approval on Tuesday and was expected to be passed within 48 hours, after which Mofaz will pledge allegiance to the government.

As part of the deal, Netanyahu agreed to back Mofaz’s proposed legislation to replace the Tal Law on national service for the ultra-Orthodox, which is set to expire in August. The new coalition will also legislate electoral reform, and the budget will be passed smoothly, the two agreed. Mofaz said that in the coming year Kadima will receive additional ministerial positions.

Israel Radio reported Tuesday that ex-Kadima minister Tzachi Hanegbi and Defense Minister Ehud Barak played a major role in orchestrating the Netanyahu-Mofaz agreement. Netanyahu approached Mofaz with the idea on Monday, and not several days ago as previously reported. Hanegbi visited Barak on Saturday afternoon at his home in Tel Aviv, and the deal was finalized over long hours in the Knesset on Monday.

The appointment of Mofaz, a former military chief and defense minister, is also potentially significant in Israel’s standoff with Iran; he has been a vocal critic of the notion of Israel striking Iran’s nuclear sites on its own.

The movement toward early elections had prompted speculation in some quarters that Israel might attack Iran’s nuclear program, perhaps within months.

The Likud and Kadima factions approved the partnership. Coalition partners Eli Yishai (Shas) and Avigdor Liberman (Yisrael Beytenu) also expressed support for the deal. Yishai said he was party to the plan from the start.

President Shimon Peres lauded the formation of a national unity government as “good for the people of Israel and welfare of the state.”

Knesset Speaker Reuven Rivlin, a veteran of Israeli politics, said he had never seen such a last-minute political upheaval. “This is good for Israel because it brings stability,” he said on Army Radio as he left parliament before sunrise. In a later interview, he said he began suspecting that something was taking place when he saw that Netanyahu, Mofaz and Barak didn’t appear for the first reading of the Knesset dissolution bill.

“I had my suspicions, but I dismissed them, telling myself it was fatigue playing tricks on me,” said Rivlin.

Ex-Kadima head Tzipi Livni, who in the past rejected offers to form a unity government under far more generous terms, posted a short message on her Facebook page Tuesday morning, indicating distaste for an alliance with Netanyahu that she had rejected when leading Kadima. “I know what sort of feelings are flooding you after the night’s proceedings, but remember that there is a different kind of politics and it will prevail,” wrote Livni.

With the formation of a national unity government, Labor chairwoman Shelly Yachimovich will likely assume the mantle of leader of the opposition.

Yachimovich denounced the deal as “an alliance of cowards and the most ridiculous and ludicrous zigzag in Israeli political history.”

Meretz chairwoman Zahava Gal-On called the formation of the national unity government “an odious act” and said that Netanyahu and Mofaz had sent a disgraceful message to the public.

Ex-TV anchor Yair Lapid, who must now presumably wait until late 2013 to enter the political fray, scorned the deal as “old politics, corrupt and ugly… politics of seats instead of principles, of jobs instead of the public good, the group’s interests instead of the entire country. This disgusting political alliance will bury all of its members beneath itself.”

Hadash MK Dov Hanin said the new unity government was established to approve an Israeli strike on Iran and warned that the political deal would lead to a regional war.

Arab MK Ahmed Tibi mocked Mofaz, saying he broke the world record for shortest stint as opposition chairman. He said that with the deal, Kadima had turned into a Likud subsidiary.

Criticism of the move was also voiced by hawkish coalition member MK Danny Danon (Likud), who said accepting Kadima into the government was a departure from the party’s right-wing principles.

The Knesset voting screen showing near unanimous support for the dissolution of the knesset before the deal was made public late Monday night. (photo credit: Noam Moskowitz/Flash90)

The Knesset voting screen showing near unanimous support for the dissolution of the Knesset before the deal was made public late Monday night. (photo credit: Noam Moskowitz/Flash90)

The sensational move was disclosed shortly after the government’s bill to dissolve the Knesset had passed its first reading Monday night by 109 votes to 1, with Kadima supporting it. Parliament was then proceeding toward the second and third readings of the bill, en route to general elections on September 4.

“Moments before the dissolution of the Knesset, [there was] a hasty meeting to establish a national unity government,” Likud MK Carmel Shama Cohen wrote on his Facebook wall.

Initial reports indicated that Netanyahu and Mofaz identified a common interest in staving off early elections and forging a new unity partnership: It would reduce the prime minister’s dependence on the smaller factions that have been pressuring him, and it would give Mofaz a chance to try to build up Kadima’s public standing. In recent polls, it has been heading for only about a dozen seats if elections were held in the near future.

Netanyahu’s Likud, with 27 seats, and Kadima, with 28, are the two largest parties in the current Knesset. Netanyahu and Kadima’s previous leader, Livni, discussed a unity government after the 2009 elections, but could not agree on terms, and did not get on well personally. The Netanyahu-Mofaz relationship, though not without friction, is rather better, observers say.

For Netanyahu and Mofaz, a unity partnership with Kadima that staves off elections also potentially weakens a resurgent Labor party — or at least prevents it from boosting its Knesset presence in the near future — and might take some of the wind out of the sails of neophyte Yesh Atid party leader Lapid, who was polling at about 12 seats. While some Kadima MKs might object to the fact that only Mofaz will receive a position, they can breathe easier now that their Knesset seats are no longer threatened by national elections.

Mofaz, who just last month became the head of the opposition, had pledged not to join the government.

“I intend to replace Netanyahu,” Mofaz had told The New York Times after his resounding victory over Tzipi Livni. “I will not join his government.”

According to Army Radio, the deal was deliberated in secret last week, while Netanyahu was mourning the death of his father. Only a handful of people were privy to the proceedings, said to be spearheaded by former senior Netanyahu aide Natan Eshel.

Coalition chairman Zev Elkin, the sole Likud MK to be party to the deal, said there were several preliminary, secret meetings to discuss the agreement but the final decision was made only at the 11th hour.

“I think Livni made a mistake by not joining the coalition. Mofaz made a difficult decision, but he took this idea and went with it… The negotiations were not at the expense of the other coalition members,” he said.

“I think Lapid is the biggest loser from all this, and Yachimovich — I think she planned for something else.”