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Histadrut, Employers Agree to Freeze One-third of Wage Cuts with Israel Government

Representatives of the Histadrut and the employers association here today reached an agreement after protracted negotiations providing that one-third of the cost of living allowance, which will be out from workers’ wages as a result of the decline in the government index, will be frozen with the government, pending publication of the next quarter’s cost of living index.

Meanwhile, it was reported that the cost of living has been reduced 37 points in the first five months of Israel’s austerity program. The drop includes a 22 percent reduction in food prices, an estimated $20 monthly saving for an average family of four.

An official spokesman today denied a report published abroad that the Israel Government is considering a further devaluation of the Israel pound in relation to the dollar.