Prime Minister Ariel Sharon is determined to push the 2003 budget through parliament today, without changing it as his coalition partners demand, he told a delegation of buiness leaders on Monday.
Despite fierce criticism of the budget from every side, it appears Sharon does have a majority for it in the cabinet. At most, he will probably need to make minor changes, primarily reductions in cuts that would hurt new immigrants and single-parent families.
Furthermore, substantial progress was made yesterday on one of the thorniest issues - the treasury's planned NIS 3 billion cut in the defense budget. A senior Finance Ministry official said several major disagreements were resolved during talks with Defense Ministry officials yesterday, and he hoped the remaining disagreements would be ironed out by this morning. Much of the progress, he said, was thanks to the $200 million grant for fighting terrorism approved last week by the United States Congress.
Although both Sharon and Shalom continued their lobbying efforts late into last night, they believe they are assured of support from at least half of the cabinet's 26 ministers - the Likud's nine, the Center Party's two and the National Religious Party's two. Since the prime minister is permitted to vote twice in the event of a tie, this is sufficient for the plan to be approved. They are also hoping to win support from Housing Minister Natan Sharansky (Yisrael b'Aliyah).
Shas's five ministers will certainly vote against, as will some of Labor's seven ministers. But Sharon and Shalom hope that at least three Labor ministers - Defense Minister Binyamin Ben-Eliezer, Foreign Minister Shimon Peres and Minister without Portfolio Ra'anan Cohen - will either abstain or absent themselves from the vote instead.
Sharon also met with the heads of the various coalition factions yesterday in an effort to garner their support once the budget reaches the Knesset. Contrary to expectations, the meeting passed without any heated arguments.
The Coordinating Bureau of Economic Organizations, an umbrella group representing large employers, expressed strong support for the budget plan at their meeting with Sharon yesterday, and repeated it at a later meeting with Ben-Eliezer, the Labor Party chairman. Oded Tyrah, the bureau's president, said the plan was essential to stabilize the economy and pave the way for renewed growth, and its success in the cabinet would be closely watched by international credit rating organizations.
Lahav, an umbrella organization for the self-employed, also published a statement of support for the budget yesterday, saying "all the alternatives are disastrous for the economy." But Ben-Eliezer insisted the budget was one-sided, cutting too deeply into defense while not reducing allocations for settlers and the ultra-Orthodox at all.
Interior Minister Eli Yishai (Shas) said the planned cuts in National Insurance Institute allowances were unacceptable, adding: "It's not enough that [the treasury's] economic policy hasn't created jobs; now the treasury is attacking the victims of its policy." Yishai tried to persuade Sharon to postpone the cabinet meeting for two weeks, during which time the social and economic cabinet could negotiate with the treasury on substantial changes in the plan, but Sharon rejected this proposal.
The NII charged yesterday that the treasury's plan would hurt some 108,500 families who live off income maintenance payments. Under the proposed new rules, 11,450 families would lose their allowances entirely, the institute said.
In addition, the cuts would hurt 46,000 single-parent families, or 98% of all single-parent families in Israel, the NII said. Their allowances would be cut on average by about one-third, or NIS 700 a month.
Some 23,000 needy families who receive income supplements would see their allowances cut by an average of 42%, or NIS 710 a month; another 2,000 families would lose their stipends entirely, the institute added. And the cuts would also hurt 42,000 immigrant families, with some 2,200 losing their allowances entirely and the rest seeing their stipends cut by about 30%, or NIS 607 a month.