Massive cuts planned in 2007 budget

Among proposed cuts to fund war: 50% hike in university tuition, major layoffs.

By JPOST.COM STAFF
hirchson 298.88 (photo credit: Ariel Jerozolimski [file])
hirchson 298.88
(photo credit: Ariel Jerozolimski [file])
The 2007 national budget plan, which will be presented in a press conference on Monday, will include major cutbacks to help fund the war in Lebanon. The program includes an increase of tuition in universities and colleges, a cancellation of grants for soldiers who finished their mandatory service, a halt to the planned raise in minimum wage and the dismissal of 30,000 civil servants.
  • Labor slams proposed budget cuts
  • War causing defense budget to soar The cabinet is slated to discuss the plan on Sunday before it reaches the Knesset for final authorization. Prime Minister Ehud Olmert and Minister of Finance Avraham Hirschson already agreed to increase the 2007 national expenditure to 3.3 percent instead of 1.7% as previously planned. In addition, the national deficit will be raised from 2% to 2.9%. The Finance Ministry announced that it would not meet the Defense Ministry's request for an increase of NIS 29.8 billion over the next three years, but rather allowed for an increase of only NIS 9 billion. The ministry will also recommend establishing a team of professionals, including military experts and budget planners, to further examine the matter and re-asses the amount needed for an increase in the defense budget. Tertiary tuition will be gradually raised by 50% over the next four years, from NIS 8,000 to 12,000. This would apply to learning institutions, which relied on government-backed financing. Already in 2007, tuition will increase by NIS 400 to 1,000, the plan stipulates. The ministry also proposed to freeze the increase of the minimum wage, which was expected to be raised by June 2007. In addition, the plan calls for the unification of 60 regional councils located close to one another, most of them Arab councils in the Galilee. Several Jewish communities in the areas of Rosh Pina, Hatzor Haglilit, Mazkeret Batya, Ekron, the Upper Galilee and Metula would also be unified. By January, grants to soldiers who completed their mandatory service would be taken away from those who worked for at least six months in gas stations, workshops, garages and security in learning establishments. The age of those eligible for the unemployment benefit would be raised from 20 to 28. Massive changes would also be made to the foreign workers policy including a 50% reduction in the number of workers permitted to work in the building sector - from 12,000 to 6,000. The amount of foreign workers allowed to work in Eilat's restaurants and hotels would be reduced as well. The changes would also have an effect on retirement, raising the age to 67 for men and 64 for women. Police would no longer receive similar wages as IDF career servicemen, and would begin receiving their salaries in the form of a civil servant's salary.