PRESIDENT BUSH was rewriting the terms of America’s handover of power in Iraq yesterday after the country’s leading Shia cleric threatened to boycott the plans.

An aide to Grand Ayatollah Ali al-Sistani, the spiritual leader of Iraq’s 15 million Shia Muslims, said he might issue a religious edict, or fatwa, to declare the US plan illegitimate unless it was changed. Ayatollah al-Sistani wants all Iraqis to elect the government that will take control from the US-led administration on July 1, rather than the indirect caucuses proposed by America.

As Paul Bremer, the US administrator in Iraq, arrived at the White House for crisis talks with Mr Bush, officials said the Administration was ready to “refine and improve” the handover plans. After his talks Mr Bremer said there would be no changes in the handover date.

“I welcome the prospect of returning to the private sector on July 1, and I still intend to do so,” he said. But he added that the US was prepared to change its proposals of how the caucuses are convened, opening up the process in an effort to meet Ayatollah al-Sistani’s demands.

Mr Bremer will appeal to Kofi Annan, the United Nations Secretary-General, on Monday to give the UN’s stamp of approval to the US plan, which is also backed by the American-appointed Iraqi Governing Council (IGC).

The US insists that it would be impossible to organise direct elections by the end of June. There has been no census in Iraq for years and a register of voters does not exist.

The White House also fears that a direct election would immediately entrench majority Shia rule, which could spark a backlash from minority Sunnis and Kurds. Officials have also given warning that the US would lose a lot of face if it postponed the handover date to accommodate elections.

The IGC and Mr Annan agree with the US argument that there is not enough time to organise direct elections. But Mr Annan is reluctant to give UN authority to a process over which it has no control. Adnan Pachachi, President of the IGC, said he believed that Ayatollah al-Sistani, could be persuaded to accept changes to the complex plan.

It envisages holding 18 regional caucuses which would pick members of a national assembly, which in turn would select a government. That body would preside while a constitution was drawn up before national elections in 2005.

Hojatoleslam Ali Abdulhakim al-Safi, the second most senior Shia cleric in Iraq, sent a letter to Tony Blair and Mr Bush accusing them of trying to marginalise the Shia majority.

“Your plan to the transfer of powers is vague and too complicated. It is nothing other than replacing one dictatorship with another to serve your own re-election goals.”

In another development, Japan’s biggest and most dangerous postwar military operation got under way last night as an advance party of soldiers flew from Tokyo en route to Iraq. Demonstrators protested as the 30 departing members of the Ground Self-Defence Force took part in an emotional ceremony at the headquarters of Japan’s defence agency.

Separately, the commander of US forces in Iraq, Lieutenant General Ricardo Sanchez, ordered an investigation into reports of abuse of prisoners at coalition centres. The military gave no further details.

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