Finance Minister Yuval Steinitz and Defense Minister Ehud Barak remained at loggerheads on the topic of defense expenditure Tuesday, with Barak rejecting Steinitz’s claim that his ministry needs more transparency.

Steinitz referred to the defense budget in his keynote speech at the annual Sderot Conference for Society Tuesday, saying that he too believes in increasing the defense budget, but that all spending must be justified.

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“At the treasury we are asking for more transparency in the defense budget in order to save NIS 12 billion each year,” Steinitz said. “These are savings that will serve educational and social aims. We are not talking about cutting the defense budget, but rather about preventing budgetary exceptions.”

Barak, who spoke to reporters at Defense Ministry headquarters in Tel Aviv at the same time, said the Treasury already accounted for every shekel spent by his ministry.

Defense Ministry Budgets Director Brig.-Gen. Reem Aminoach, sitting alongside Barak, said the Treasury accountant assigned to his department approves and signs every single purchase the ministry makes – from fighter jets to cutlery. Achinoam pointed out that the accountant himself said on record in November 2009 that nothing could be hidden from him.

Barak again weighed in on the government’s economic policy, recommending that the budget deficit be increased by 0.9 percent to meet defense needs, respond to grievances raised by socioeconomic protests in summer, and to protect Israel from the effects of a fresh global economic crisis.

He said the situation was more complicated than the way Steinitz presented it, adding that instead of waiting for the inevitable wave to reach Israel, the government must deal with it in advance.

Although acknowledging that one must not live beyond their means, Barak said Europe’s problems were caused mainly because they did not worry early enough about financial stability, rather than because of over-expenditure. He said Israel’s debt-to-GDP ratio of 78% afforded it the luxury of being able to raise the deficit.

Barak was not the only person to appear disturbed by the Finance Minister’s approach Tuesday. In Sderot, Steinitz’s speech was disrupted several times by students angry over the government’s alleged failure to adequately address social-justice issues raised by this summer’s protests.

As Steinitz began speaking, students heckled from the back of the hall, calling angrily for better conditions for contract workers and more attention to employment options for those living in the periphery. One man was arrested for threatening the minister, calling out: “You might not be around in 2013, we know where you live.”

Slightly riled by the interruptions, Steinitz responded to the protesters that it was he who improved the benefits for doctors living and working in the periphery. Later on he also referred to the conditions facing contract workers – the subject of a four-hour general strike called by the Histadrut on November 8 – promising to improve their conditions significantly.

“In order for us to properly take care of society, we need a strong economy that grows and creates employment,” said Steinitz, addressing the crowd. “We have to do what we can to stop mass unemployment.”

He continued: “The global economic crisis is not only an economic crisis, it is also a social one… The average salary in the US has decreased by 10% in the last two years. When there is a recession it is not only the unemployed that suffer, but also those who are working.”

This is the eighth annual Sderot Conference examining social and economic issues.

Held at Sapir College, its aim is to shift the focus of lawmakers from the center of the country to the periphery. The conference attracts senior politicians, academics and social activists.

Several of the Knesset’s parliamentarian committees were held at the conference Tuesday.

The event continues through Wednesday.

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