Negotiations aimed returning the fired Shas ministers and deputy ministers to government will be part of the debate ahead of the Knesset vote on the emergency budget plan.
The Shas ministers and deputies were fired earlier in the week after voting against the government on the economic package.
The informal understanding between the prime minister and Shas is that in exchange for minor changes to the planned budget cuts, Shas's Knesset members will back the plan in return for restoration to their jobs.
In Sharon's bureau, the general consensus is that Shas will once again be part of the government in the near future. Indeed, the prime minister still plans to participate in a festive dinner on Monday, in honor of Shas' educational institutions. Members of the ultra-Orthodox party believe that they will be back in government by then.
Top officials of Likud, Sharon's party, were at pains to point out that the prime minister's preconditions for the return of Shas have not changed: a written guarantee by Shas chairman Eli Yishai that the party will abide by the government's decision to cut its 2002 budget, as well as other decisions passed by the government that Shas ministers have not implemented.
In addition, Sharon wants a cast-iron guarantee that Shas MKs will vote for the emergency budget plan when it comes before the Knesset for its second and third readings. Sources close to the Prime Minister say that he has already made these conditions clear to Shas spiritual leader, Rabbi Ovadia Yosef.
One day after sacking of Shas ministers came into effect, Sharon decided to initiate a rapprochement with Yosef. Sharon decided to send several senior government figures - bureau chief Dov Weisglass, cabinet secretary Gideon Sa'ar and PMO director-general Avigdor Yitzhaki - to a meeting with Yosef at his home in Jerusalem. During the course of the day, however, Sharon decided to cancel the meeting, apparently because of comments made by Yitzhaki at a meeting of economists Thursday.
Speaking to a conference organized by the Israel Management Institute, Yitzhaki said that the Shas ministers were fired, "only out of a fear of the next morning's headlines, and the fear that the stock market would collapse and the ensuing hysteria in the currency markets." Instead of holding this meeting, Sharon sent a hand-written letter to Yosef, in which he laid out his conditions for Shas' return to the government.
The emergency economic package passed by an overwhelming 65-26 majority Wednesday, with seven abstentions and 22 MKs missing from the plenum, including the entire Shas faction.
Sharon is likely to wait to see how Shas votes on the final reading of the emergency plan bill before deciding whether to begin efforts to bring the stridently secular Shinui party into his coalition.
With his coalition now resting entirely on the Labor Party, Sharon asked Wednesday for advice on how long it would take to conduct elections, both general and for prime minister.
While Sharon asked for the data about timing new elections, he also sent Weisglass, to speak informally with the leader of National Union-Yisrael Beiteinu, MK Avigdor Lieberman, who quit the government earlier this year in protest against Sharon's peace maneuvering.
Lieberman said he had held non-binding talks with Weisglass, a Tel Aviv attorney who has long represented Sharon and also counts Lieberman among his clients.
"We didn't say 'no' and we didn't say 'yes,'" Lieberman said, adding: "Everything is open. But I wouldn't say that I see us rejoining the coalition as very realistic. I'm missing a lot - a lot about the Palestinian state, and the international conference, and the rest home where Rehavam Ze'evi's killers are basking in the sun in Jericho."
The right-wing party is partnered with Moledet, whose leader, MK Benny Elon, said Wednesday that the party would only go back into the coalition if it got back the two ministries it had given up when departing - National Infrastructures, which was held by Lieberman, and Tourism, which the Moledet leader had held.
Sharon's people have not made any approaches to the anti-Haredi Shinui, which changed its Monday "nay" vote on the economic package to an abstention Wednesday - apparently in fear that a deal with Shinui would permanently foul Sharon's relations with the Haredi parties, with which Sharon has had a close relationship for years.