Q&A: Israel's new government

Inauguration session of the new Knesset in February 2013 The new government controls 68 out of 120 Knesset seats

A new Israeli government has been sworn in - nearly two months after Israelis went to the polls.

Coalition talks were difficult and drawn-out but finally led to agreement between four parties: Likud-Yisrael Beitenu, Yesh Atid, Jewish Home and Hatnua. These control 68 out of a total of 120 seats in the Israeli parliament or Knesset.

Israeli government policies have implications for relations between the secular and religious communities, the peace process with the Palestinians, Israel's relations with the international community and the crisis over Iran's nuclear programme.

Here is a guide to the new government.

Who will be the key players?

Yair Lapid (left) and Naftali Bennett (right) at a reception marking the opening of the 19th Knesset on 5 February, 2013. Yair Lapid (L) and Naftali Bennett (R) are the rising stars of Israeli politics

The Israeli Prime Minister, Benjamin Netanyahu, will remain in office as head of the Likud-Yisrael Beitenu bloc, which controls 31 Knesset seats, the largest bloc. However, there will be several new faces in his next cabinet.

The key ministries of finance and education are to be headed by Yesh Atid, which won 19 seats in the 22 January election. Naftali Bennett of Jewish Home will lead the Industry and Trade Ministry and his party will have control of the Housing Ministry.

For now, Mr Netanyahu will handle foreign affairs, pending the conclusion of a corruption trial of his ally, the former foreign minister, Avigdor Lieberman. The defence and interior ministries will also be kept by the Likud party. This gives it the final say in military matters and immigration policy.

Former foreign minister, Tzipi Livni whose Hatnua party holds six Knesset seats, is the junior partner in the coalition. Mrs Livni will serve as justice minister and chief negotiator in any future talks with the Palestinians.

What was the process for officially forming the government?

After the coalition agreement was finalised during several weeks of tough talks, it was signed just before the Jewish Sabbath began on Friday afternoon.

The leaders of the coalition then presented their new coalition agreement to President Shimon Peres.

On Monday, the new cabinet was sworn in before the Knesset. This means a new government is officially in place just 48 hours before the arrival of US President Barack Obama who is coming to Israel and the Palestinian territories for the first time since winning the White House.

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What are the main domestic issues for the new government?

Social protest in Tel Aviv in October 2011 Social and economic issues were important in this election campaign

Israel's early elections were called by Mr Netanyahu last October when he failed to agree the annual budget with his former coalition partners. He has since made clear that passing "a responsible budget" for 2013 is the first priority of his new government. This is expected to include austerity measures.

This government is also expected to curb preferential treatment for Israel's ultra-Orthodox minority. Yesh Atid, Jewish Home and Yisrael Beitenu also strongly oppose the sweeping military draft exemptions given granted to ultra-Orthodox Jewish men so that they can study in seminaries or yeshivas. Yesh Atid also wants to cut state stipends for them and force religious schools to teach a core curriculum that includes maths and science.

Ahead of the last election a poll suggested that, for the first time in years, a majority of Israelis put socio-economic issues on a par with security concerns when deciding who to vote for. In 2011, there were unprecedented protests against rising living costs, while a report by Israel's National Insurance Institute revealed nearly one in four Israelis live in poverty.

How is the new government likely to approach peace with the Palestinians?

Tzipi Livni in the Knesset swearing-in ceremony Tzipi Livni will act as chief negotiator in any future talks with the Palestinians

There are bitter divisions among the coalition members about how to approach the Palestinian issue. Mr Netanyahu has reluctantly accepted the idea of a two-state solution to the conflict. However just days before the election he ruled out removing any Jewish settlements in the West Bank and East Jerusalem in the next four years if he was returned to office. The settlements are considered illegal by the international community.

Mr Lapid has urged a resumption of peace talks and advocates spending less money on settlements. However his party did not make this an important part of its election campaign.

By contrast Jewish Home has a strongly pro-settlement message. A former leader of the West Bank settler movement, Mr Bennett, opposes any territorial concessions to the Palestinians. He has even called for Israel to annex over 60% of the West Bank, which the Palestinians want as the heartland of any future state. As Jewish Home controls the Housing Ministry, it will have the budgets to promote future settlement construction.

Only Tzipi Livni prioritised peace-making as a central plank of her electoral platform, appealing to voters worried by the stalemate in talks with the Palestinians. She led the negotiations in Ehud Olmert's centrist government, considered to have made significant progress. However it remains to be seen what she can achieve in a similar role under Mr Netanyahu.

What are the main foreign issues for the new government?

Israeli PM Benjamin Netanyahu on election night with Avigdor Lieberman just to the left Mr Netanyahu campaigned as a strong leader

For Mr Netanyahu, who campaigned for the elections under the slogan "A strong prime minister, a strong Israel", security was - and still is - the most importance issue, with the perceived threat from Iran's nuclear programme at its heart.

He has long warned of the danger of Iran obtaining nuclear weapons capability and has stepped up the sense of urgency in recent months.

Mr Netanyahu has vowed not to let Iran enrich uranium to military grade, a point he has warned Iran could reach by this summer. He has made it clear he would be prepared to order a military strike to stop Tehran if all else fails.

The prime minister will again push for strong international action when he meets Mr Obama in the coming days. The two leaders are also expected to try to improve their poor personal relationship and discuss the situation in Syria. Israel is extremely concerned about how it could be affected as the war there increasingly draws in neighbouring countries.

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