2007 budget passes after 12 hours

NIS one billion doled out in last-minute jockeying; Peretz abstains from voting.

jp.services1 (photo credit: )
(photo credit: )
The schism threatening to break apart Prime Minister Ehud Olmert's government was torn further Tuesday as the cabinet took nearly 12 hours to pass the 2007 state budget. The final vote was 19 in favor and four against. The four Shas ministers voted against the budget and Labor Party Chairman, Defense Minister Amir Peretz abstained from the vote.
  • A seismic shekel-shock to the system The vote, which is considered a preliminary step before the budget makes its way to the Knesset, had been expected to pass by a wide majority. Instead, ministers found themselves locked in negotiations late into the night as Defense Minister Amir Peretz forbade the Labor ministers from casting their vote until his demands were met. The Shas Ministers announced early Tuesday morning that they would vote against the budget and would continue to oppose it in the Knesset unless more money was slated for social welfare programs. "If Olmert does not accede to the budgetary demands of the Labor Party the days of the government are numbered," said Peretz, whose chief demand was that the Finance Minister cancel its planned freeze on the 2007 minimum wage. Finance Ministry representatives drafted a compromise, which would guarantee a partial raise to the minimum wage, which convinced Peretz to abstain from the vote. Raising the minimum wage to $1000 per month was central to Peretz's election campaign. "His argument is unnecessary and he is acting without the rest of the party," said one Labor minister, who added that the rest of the Labor ministers had been ready to vote in favor of the budget hours earlier. "He is fighting this battle on his own." Sources close to Peretz said that they had long expected the 2007 budget to threaten Labor's relationship with the coalition. They were surprised, however, that the budget also appeared to be adding to the growing rifts within the Labor party. "The budget is like a tornado, tearing up everything in its path and sending it flying in different directions," said one Kadima Minister. "It doesn't seem too likely that these coalition partners will get into a shelter together either." Prime Minister Ehud Olmert's associates said ahead of the vote that as soon as the budget passed, the prime minister would begin to examine his options regarding the coalition. They said Olmert was considering several options, including adding parties to the coalition, making a move that would encourage the Labor party to quit the coalition and maintaining the status quo. National Religious Party head Zevulun Orlev called upon Olmert on Tuesday to form a "national rehabilitation government" with all Zionist parties for two years. Speaking at an Emunah Women's convention in Jerusalem, Orlev indicated that he would be willing to join such a government. One move that has been raised is reshuffling cabinet portfolios. Olmert's associates have warned that such a reshuffle could leave Olmert critic Transportation Minister Shaul Mofaz without a job. The relationship between Olmert and Mofaz continued to deteriorate on Tuesday when Mofaz protested budget cuts in his ministry. Mofaz has accused Olmert of depriving his ministry of funding for political reasons. Mofaz said the Finance Ministry decided unilaterally to cut NIS 150 million from the National Road Safety Authority. He said he would not tolerate the cut. "This cut will directly harm the fight against traffic accidents and endanger people," Mofaz said. "It is a horrible maneuver that will harm people's security. It is drastic and simply scandalous." On Tuesday, last minute protests by cabinet ministers forced Olmert to parcel out more than a billion shekels to various ministries. "Without a proper budget for higher education, and if the cuts in the Education Ministry continue, I cannot support this budget," said Tamir. Yishai said the budget was "impossible" to support. "I estimate that there will be changes before the budget is brought to the Knesset for approval, because if not, we will also vote against it there," added Yishai. Hirchson said that every effort would be made to diminish the harm the budget caused to the public and that more than NIS 4 billion had been allotted to social sectors. "The budget is meant to enable economic growth and a stable economy," said the finance minister. Despite the uproar over the budget, only four out of 20 members of the Knesset's Finance Committee attended Tuesday's meeting to discuss the poverty report, Israel Radio reported. The attendees included Labor MKs Shelly Yacimovich and Avishai Braverman. Kadima. Shas had no representatives at the meeting. Shas MK Amnon Cohen said he did not come to the meeting because he was tired of talking about poverty and was waiting instead for action. Earlier Tuesday, Meretz faction head Zehava Gal-On called on government ministers not to support a budget that would severely impact the public and harm the lower and middle classes. "Even after the war, we can cut into the goldmine of the defense budget without harming national security, instead of cutting public and social services," Gal-On said. After the budget passed the vote on Tuesday it will move to the Knesset, where Hirchson must present it to the plenum. The Knesset then conducts a primary vote. If the budget passes, it moves to the Finance Committee where changes are made, and then back to the plenum for a second and third vote. "The real fight will be in the Finance Committee," said one Shas MK on that committee on Monday night. "We'll see if the budget that passes is anything like the budget we see tomorrow."