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 Olmert decided to step down, and asserted her confidence in her ability to defeat him in a party election should he decline. However, her call was ignored by Olmert and her decision to stay in the Cabinet sparked some controversy. In 2008, Livni condemned a photomontage of Pope Benedict XVI with a swastika displayed on his chest, which was published on a website run by supporters of her Kadima party. Facing multiple criminal investigations for corruption, Ehud Olmert announced his intention to resign his post as prime minister following a Kadima leadership election, which was held on 17 September 2008.