Tzipi Livni with Kadima's coalition partners, particularly the Shas party, which had set conditions for joining a Livni government, including an increase in child allowances to Haredi communities, and a vow not to negotiate the status of Jerusalem during peace talks with the Palestinians. Livni was able to sign a coalition agreement with the Labor party, led by former prime minister Ehud Barak, but on 26 October, informed the President that she was unable to form a government and suggested Israel go to elections. Livni cited her unwillingness to sell out her principles just to become prime minister, stating, "I was willing
Tzipi Livni Livni and Shaul Mofaz emerged as the main rivals for the leadership. Livni won the Kadima leadership election by a margin of just 431 votes (1%). Palestinian peace negotiators were reportedly pleased with the result. As the new leader of the ruling party, Livni became prime-minister designate. Upon declaring victory, she stated "the national responsibility (bestowed) by the public brings me to approach this job with great reverence." On 21 September 2008, Olmert formally resigned in a letter submitted to president Shimon Peres, and the following day Peres formally asked Livni to form a new government. Livni faced tough negotiations