Tami Threatens to Quit Coalition

The Tami movement today threatened to leave the coalition government because the Treasury has indicated that it intends to charge an estimated 330 Shekel education fee a month for school children.

The three-member Knesset faction claimed that by levying such a fee the government would take back benefits which were recently given to large families after Tami pressured the government. If Tami quits, the coalition would be left with 61 seats in the 120-member Knesset.

Tami’s threat was prompted today because the Knesset postponed a session during which it was to have approved grants promised to large families. In addition, Tami leaders were upset by the Cabinet’s decision yesterday to increase the tax on consumer goods by 10 percent. The Cabinet’s action took place within the context of the Treasury’s effort to prune the government budget by 55 billion Shekels, including a cut of 20 billion Shekels in the defense budget.

The Treasury has run into a roadblock in its drive to obtain the 55 billion Shekel cut. It is now apparently going to be able to reduce the budget by only 40 billion Shekels. Following the Cabinet session, acting Cabinet Secretary Michael Neer read a prepared statement which said:

“The government today decided to cut 40 billion Shekels from its budget. Of this amount, agreement had already been reached among ministers for a reduction of 30 billion Shekels. As for the remaining 10 billion Shekels, this will originate in a cutback of three billion Shekels in school and university expenditures, and raising of seven billion Shekels by decreasing all ministry budgets by an additional one percent.”

The decision to increase taxes on consumer goods immediately affected the price of cars, refrigerators, TV sets, washing machines and most electric appliances. Furniture was exempted from the hike.