Cabinet Postpones Economic Decisions

The Cabinet ended its session today without approving any of the budget cuts proposed by Finance Minister Yoram Aridor last week or those recommended by the Ministerial Economic Committee last Wednesday after three days of deliberations behind closed doors. The Cabinet is scheduled to continue its assessment of the proposed cuts at a special meeting tomorrow.

The major difficulty at the Cabinet session today was the Treasury’s demand that the defense budget be slashed by 20 billion Shekels. Defense Minister Moshe Arens is fighting hard against the proposed cut and has told his Cabinet colleagues that he would insist on a Cabinet decision, implying that the responsibility for the defense budget cut should be borne by all the ministers, not just by himself alone.

ARENS CITES HARD CHOICE

Arens was quoted by Haaretz last Friday as saying “The choice is between our standard of living — and life itself.” Some observers interpreted this to mean that Arens felt the proposed 20 billion Shekel cut would impair and thereby endanger the nation’s vital defense needs.

Treasury and Defense Ministry representatives were to meet tonight in informal sessions to try to bridge the differences between Arens and the Treasury. Arens had indicated last week that he was willing to allow a five billion Shekel cut, but not more.

Aridor had also called for cuts in the budgets of other ministries, including health and social welfare, education, transportation and communications. The Ministerial Economic Committee approved a package of cuts in these areas.

However, a fight is looming between Education Minister Zevulun Hammer and the Treasury. Hammer is abroad on vacation, but he has let it be known that he will not accept an assault on free secondary education which he considers one of this government’s major achievements. The Finance Ministry proposals call for a 2.5 billion Shekel cut in the education budget.

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