UPDATE 1-Czech president taps election winner Babis to lead government talks

(Updates with comments, details after paragraph 2) PRAGUE, Oct 27 (Reuters) – Czech President Petr Pavel on Monday tapped Andrej Babis, leader of the populist ANO party that won a parliamentary election this month, to lead talks on forming a new government, a next step in the billionaire former prime minister's return to power. Since the October 3-4 election, ANO has been in talks with the right-wing, eurosceptic Motorists and the far-right, anti-European Union and anti-NATO SPD parties, which would hold a combined 108 out of the 200 seats in parliament's lower house. The parties are finalising a joint government agenda that is likely to lead to higher fiscal spending , less support for Ukraine's defence against Russia and stronger opposition to EU migration and climate policies than under outgoing Prime Minister Petr Fiala's centre-right government. Pavel said he entrusted Babis with forming a government due to the course of negotiations between the parties. He said he would see the text of the planned government agenda in the second half of this week. NEXT STEP IN FORMING GOVERNMENT Asking Babis to officially lead talks is another step in the handover of power, and comes before Babis can be nominated as prime minister-designate. Babis said earlier on Monday that he informed the president about parts of the shared programme, including foreign policy. After finalising a joint government agenda, parties must agree ministerial nominations. ANO officials said last week the country's anchoring in the EU and NATO was explicit and "unquestionable" in the agenda. The SPD had campaigned demanding a law allowing a referendum on those issues. Pavel, a former NATO official who has focused on foreign policy and security aspects in the government talks, has also urged parties to maintain a Czech-led and foreign-funded programme shipping artillery ammunition to Kyiv, which Babis has called overpriced and non transparent. The president appoints prime ministers and ministers. Parliament meets on November 3, after which it elects a new house speaker before the resignation of the current cabinet – the earliest time a new prime minister can be appointed. Babis also faces conflict of interest questions related to his food, agriculture and chemical business empire. Pavel said Babis ensured him he would publicly address this before any possible appointment. (Reporting by Jason Hovet; Editing by Aidan Lewis)

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