Short-lived Resignation

Minister of Commerce and Industry Yigal Hurwitz resigned from the Cabinet yesterday but withdrew his resignation 24 hours later after winning his point that the national budget must be cut. Hurwitz, whose portfolio includes the former Ministry of Tourism, announced he was quitting after the Cabinet approved an IL 206 billion budget yesterday. This included a supplementary budget of nearly IL 298 million that the ministers had tacked onto the IL 179 billion budget approved by the Knesset three months ago.

The increase was justified by excessive wage increases, the rapid devaluation of the Pound and the government’s commitment to Histadrut to freeze its price supports for basic commodities instead of reducing or eliminating them. But Hurwitz balked and described the decision to include the supplementary IL 298 million as “a boost to inflation.” He said he did not want to share the responsibility for such a decision. When Finance Minister Simcha Erlich said all possible cuts had been exhausted, Hurwitz handed in his resignation to Premier Menachem Begin who refused to accept it.

Today, Begin promised that the Knesset Finance Committee would introduce an IL 3 billion cut in the budget. Ehrlich said “I have never opposed additional cuts. As far as I am concerned, one can cut the budget even by IL 5 billion. If one can point at additional cuts, I shall accept them.” The outcome is that all parties are pleased, Hurwitz won his point, Begin avoided a Cabinet crisis and Ehrlich side-stepped responsibility for budget cuts that will reduce essential services. The onus will fall on the Knesset Finance Committee.