Israeli Housing Minister Ariel Sharon’s ambitious construction plans were challenged this week on both the political and economic fronts.
At the Knesset Finance Committee, Committee Chairman Moshe Feldman of Agudat Yisrael prevented the allocation of some $375 million to the Housing Ministry by simply staying out of the country.
And the outgoing governor of the Bank of Israel, Professor Michael Bruno, demanded at a farewell news conference Wednesday that the Housing Ministry stop “excessive construction and waste of money.”
The trouble at the Knesset Finance Committee began when the Treasury asked the committee to approve additional funds for work on housing infrastructure and for the purchase of mobile homes for new immigrants and young couples.
The committee did not act on the request, saying it could not do so while its chairman was abroad.
That explanation did not convince some angry committee members.
Sharon, too, was angered by the committee’s failure to act, which he attributed not to Feldman’s absence, but to the chairman’s disgruntlement over the fact that lands for construction were not allotted for housing projects in the haredi community.
The Housing Ministry insists that the delay in allotting plots to the haredi community was due to a ban by Attorney General Yosef Harish, who was looking into the legal aspects of those allotments.
Meanwhile, Feldman’s assistants at the committee said that there was no need for the chairman to approve the land allotment, since Sharon had shown himself perfectly capable of proceeding with construction he favors, even in the absence of the necessary permits.
The more serious challenge to Sharon’s expansive housing plans was leveled by Bruno, speaking a day before the Central Bureau of Statistics announced a record 10.7 per cent rise in the cost of housing index.
Bruno warned that the nation’s housing and security budgets must be cut in order to avoid a rekindling of accelerated inflation.
According to Bruno, the Housing Ministry last year spent an excessive amount of money for housing in areas with little demand. He called for an overall reevaluation of the housing policy, “particularly due to the slower-than-anticipated rate of immigration.”
“If we continue this process for another year,” warned Bruno, “we shall find ourselves at a point of a giant crisis in the housing business.”
A Housing Ministry spokesman responded by calling Bruno’s analysis overly academic.
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