Industry and Trade Minister Eli Yishai learns bakeries intend to raise bread prices by 50%, announces he will not sign final order canceling subsidies. 'Markup unacceptable,' he says
Industry, Trade and Labor Minister Eli Yishai announced Sunday that subsidized bread prices will continue to be regulated by the government.
Several weeks ago, Yishai decided to cancel the
regulation of subsidized bread prices, which has been in effect since the 1950s; but after learning bakeries intend to raise bread prices by some 50%, he eventually decided against signing the final order deregulating the subsidy.
Markups
Prices of subsidized milk products to rise / Tani Goldstein
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"I made my decision after realizing that the bakeries intend to drive the prices up by much more than the 12% we had agreed upon… all of a sudden they were talking about a 50%, 70% markup – that's too much and it's unacceptable," he told Ynet.
Yishai still has to convince his fellow ministers to go back on the decision, which was originally brought to a vote in a bid to compensate bakeries for rising wheat prices.
Bakery owners were outraged at Yishai's decision: "He just gotten cold feet," Yitzhak Berman, owner of Berman's Bakery, told Ynet.
"Our loss percentage for every loaf of subsidized bread is in the dozens. We still have to raise prices, even if he doesn’t cancel the subsidy… if we're barred from doing that, we'll just stop making it," he added.
Finance Minister Ronnie Bar-On was surprised to hear of Yishai's decision: "I still have to look into it. I don't understand how he can just go back on a decision he made less than a month ago… Rescinding the order will take some time. It won't happen tomorrow morning."
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