Despite reports of progress made during Sunday's meeting between representatives of the Shas and Kadima parties on the formation of a coalition led by designated prime minister Tzipi Livni, not everyone is optimistic.
Aides to the Kadima chairwoman said they fear the negotiations may come to a halt despite the desire by both sides to reach an agreement.
Representatives from Shas and Kadima agreed to meet again on either the end of the Sukkot holiday or on Wednesday morning.
The main point of contention appears to be on the subject of Shas' demand to increase child welfare stipends; Livni is opposed to any deviation from the State Budget. The talks between the two parties have introduced several alternatives that are meant to bridge the gap.
Meanwhile, Livni is expected to arrive at the official residence of President Shimon Peres on Monday to ask for a two-week extension he is allowed to approve under Israeli law, in order to assemble a government.
Negotiations regarding the establishment of a new government have been delayed due to the quick succession of Jewish holidays.
Livni intends to introduce a government as soon as possible, especially after an agreement with the Labor party has already been reached.
While the main effort lies with the negotiations with Shas, negotiations are also underway with Meretz-Yahad and United Torah Judaism.
Livni is aware of the difficulties she will face in running a government which does not have a clear majority in the Knesset, with her main goal being the establishment of a government with the partners of the outgoing government, including Labor, Shas and the Pensioners party.