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 appointed Minister of Immigrant Absorption. She held this position until 2006. In 2004, Livni was appointed Minister of Housing and Construction, which she held this position until 2005. Livni was an avid supporter of Sharon's disengagement plan, and was generally considered to be among the key moderate members of the Likud party. She often mediated between various elements inside the party, and was integral to garnering government support for disengagement with the "Livni Plan". She made efforts to achieve a two-state solution to the Israeli–Palestinian conflict, including successful efforts to have the pullout from the Gaza Strip ratified by the