Minister Herzog: Broad anti-budget coalition taking shape

Labor party minister says no agreement has been reached with Treasury on budget cuts; Finance Ministry officials to hold intense discussions ahead of government session

Reuters | Published: 08.23.08, 20:09

Tensions high ahead of government session on budget: Treasury officials will engage in intense discussions Saturday night ahead of the upcoming government session on the 2009 state budget. At this time it appears that agreement on the contentious budget is nowhere in sight.

Social Affairs Minister Isaac Herzog said that contacts with the Treasury apparently reached a dead-end.

"No solution has been worked out yet with the Treasury in respect to the serious cuts that would hurt pensioners, women, and children," he said. "My impression is that the Treasury team is unwilling to compromise and is showing extreme inflexibility."

Herzog, who spoke with other Labor party ministers over the weekend, said that it appears that a broad coalition against the budget is taking shape.

"If they want to pass the budget, they better regain their senses and adopt creative thinking," the minister said.

In addition to Herzog, Pensioners' Party ministers have also expressed their objection to the budget and presented a list of demands. Among other things, they requested that NIS 500 million (roughly $150 million) be earmarked for old-age allowances. Meanwhile, Shas ministers have demanded that child allowances be boosted and are expected to unanimously vote against the budget.

Yet the main bone of contention remains the defense budget. Defense Minister Ehud Barak has said he objects to cutting the budget by NIS 2 billion (roughly $600 million.) The Labor party leader said that this would be the wrong decision in the face of future threats against Israel.