Prime Minister Benjamin Netanyahu has cut a deal with Israel Beiteinu to switch its support for the Trajtenberg report, in exchange for more benefits for young working people and soldiers. Israel Beiteinu's support suggests Netanyahu now has enough votes to pass the report, after he was forced to postpone a vote in last week's cabinet meeting.
Israel Beiteinu demanded that the threshold for housing subsidies be linked to income. Under the deal, the threshold will be set at a 125% job by a couple.
Netanyahu and Israel Beiteinu also agreed to build 4,000 subsidized apartments over 3-4 years, and 1,000 municipality owned apartments over three years. A deal was also reached over the so-called Matalon law for IDF draftees and people doing National Service, will receive the average national salary (currently about NIS 8,500 a month) during their last three months of service, irrespective of current grants. No deal was reached on reducing or cancelling VAT on water.
Last week, the ministers of Israel Beiteinu, Shas, and Ha'atzmaut all opposed the Trajtenberg committee recommendations. Shas objected because the report offered no help for the poor, Shas's base of support, and Ha'atzmaut, headed by Minister of Defense Ehud Barak, objected to the report's recommendation to cut the defense budget.
Shas and Ha'atzmaut still oppose it, but Netanyahu and Minister of Finance Yuval Steinitz expressed confidence that they would succeed in passing the recommendations in the second attempt.
National Union of Israeli Students chairman Itzik Shmuli said in a statement, "The students oppose passing the report as a single piece. This is a partial report with missing pieces and includes many important remarks but thin and inadequate recommendations. The students will fight with all their might to achieve real housing solutions, especially public housing solutions, extend the free education law to begin immediately after maternity leave, limit the use of contract workers, and lower prices for basic goods. In view of the government's lack of response in providing solutions in these areas, except for verbal sleight of hands, we and our partners are preparing to intensify the struggle to achieve real solutions."
Published by Globes [online], Israel business news - www.globes-online.com - on October 9, 2011
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