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World The Civic Democrats are leading coalition talks with two other center-right parties, TOP09 and Public Affairs, after the three won a combined 118 seats out of 200 in a May 28-29 election with pledges of austerity and fighting corruption. If the three parties agree on a coalition government they would have a strong majority to kick-start key reforms in pensions and healthcare compared with previous cabinets over the last decade which lacked a strong enough majority and the will to reform. Talks between the parties have dragged because of disputes over policy and ministerial posts, including who should run the important finance ministry. Necas has said he wants a deal by early July, in time to prepare the 2011 budget. "Tomorrow at 10 a.m. I will name Petr Necas as prime minister," Klaus said on Sunday in a live television interview. Klaus accepted the resignation of caretaker Prime Minister Jan Fischer on Friday ending a year-old interim cabinet that led the country after the collapse of the previous center-right government. He will stay on until a new cabinet takes power. Investors, analysts and rating agencies cheered the center-right victory as the best possible election outcome, and most-likely grouping to make pension and health reform -- areas in which the country of 10.5 million has lagged neighbors. TOUGH TALKS STILL The Czechs and other central European countries have mostly kept public budgets under control in the economic crisis and have debt levels lower than the European Union average. But to meet the EU's 3 percent of GDP deficit ceiling in the coming years, they all must find more savings. The parties have agreed to cut the 2011 fiscal deficit to at least 4.8 percent of economic output, from 5.3 percent planned for 2010, by reducing money for state salaries and ministry budgets across the board, among other measures. The Civic Democrats would get six posts in the cabinet, while conservative TOP09 and centrist Public Affairs would get five and four seats. However, TOP09 has pushed hard to have its vice-chairman and former finance minister, Miroslav Kalousek, as head of the finance ministry -- which many Civic Democrats have resisted. Public Affairs, which along with TOP09 entered parliament for the first time, has said it might not enter the coalition but would support it in votes. Party Vice-Chairman Vit Barta was quoted on Sunday as saying there was still a chance of this. "The chance that we will be directly in the government is now about 20 percent. The probability is directly correlated to an agreement on the government programme, and can grow," Barta was cited as saying by online server iDnes.cz. Another party official said on Sunday on Czech Television that the party would not enter the government if Public Affairs Chairman Radek John did not get the interior minister post. (Editing by Matthew Jones) World Add a Comment *We welcome comments that advance the story directly or with relevant tangential information. We try to block comments that use offensive language or appear to be spam and review comments frequently to ensure they meet our standards. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. © Copyright 2010 Thomson Reuters Editorial Editions: Africa Arabic Argentina Brazil Canada China France Germany India Italy Japan Latin America Mexico Russia Spain United Kingdom United States Reuters Contact Us Advertise With Us Help Journalism Handbook Archive Site Index Video Index Reader Feedback Analyst Research Mobile Newsletters RSS Podcasts Widgets Your View Labs Thomson Reuters Copyright Disclaimer Privacy Professional Products Professional Products Support Financial Products About Thomson Reuters Careers Online Products Acquisitions Monthly Buyouts Venture Capital Journal International Financing Review Project Finance International PEhub.com PE Week FindLaw Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com, video, mobile, and interactive television platforms. 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