The Israel Government will continue to apply the brakes to the economy in the coming fiscal year, in its pursuit of a more stable and more productive economy, but at a slower pace than at present, the budget presented to Parliament last night indicated.
The budget was presented by Pinhas Sapir, the Finance Minister. It calls for expenditures in the fiscal year starting next April of $1,700,000,000, an increase of $144,000,000 over planned outlays for the current fiscal year. The ordinary budget calls for only slight increases in outlays, mainly for social services. However, large sums are earmarked for development in an effort to ease Israel’s austerity-induced joblessness. More than two-thirds of the increases in the budget will go for such projects.
Although larger expenditures are projected, the budget does not include any tax rises. Additional government income is projected from larger personal and corporate income anticipated from reactivation of the economy.
CONCEDES GOING TOO FAR IN APPLYING BRAKES TO ISRAEL’S ECONOMY
The Finance Minister conceded that the braking operation had gone too far during the current fiscal year and created the danger of crippling production. He said the 1967 budget was designed to ease Government curbs but without countering the Government’s basic goals of deflating the economy, reducing the world trade gap, holding back increases in personal consumption and improving worker morale and productivity.
Direct allocations to promote exports and develop foreign sales will be doubled in the next fiscal year. Subsidies to keep stable domestic prices of such foods as milk, bread and meat will be continued. Special consideration is being given to families with an annual income of less than $1,500, who will benefit from a special fund set aside by the National Insurance Authority.
Road, bridges and electrical projects, which were delayed in previous years because existing manpower was considered too costly, will be resumed under the new budget. Vocational and secondary schools in new immigrant areas rank high on the list of budget priorities. President Shazar was among the Government officials who braved flooded roads to get to the Knesset to attend the presentation of the eagerly-awaited budget.
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