Yachimovich backs Lapid on higher deficit

Opposition head Shelly Yachimovich: For the first time since taking up office, the finance minister has done the right thing.

"For the first time since taking up office, the finance minister has done the right thing," said Labor Party chairwoman MK Shelly Yachimovich in response to Minister of Finance Yair Lapid's Yair Lapid proposal to raise the 2013 deficit target to 4.9% of GDP. "This will slightly limit the austerity measures and the squeezing of the economy and the public."

If the cabinet approves the proposal at Sunday's meeting, government spending will grow by NIS 6.5 billion this year, and the budget cut will be reduced to NIS 13 billion.

Yachimovich continued, "We should now urgently create a package of incentives that will stimulate the next wave of growth. The finance minister should not forget the middle class is the economy's most important growth engine, and anything that harms it - VAT and tax hikes, erosion of its salary, cutting the health and education it receives - harms the economy and country."

Yachimovich slammed the austerity policies being applied in Europe, saying, "Even the EU has become skeptical about the effectiveness of austerity, and voices are growing around the world calling for oxygen to be given economies to recover and avoid a slowdown and recession instead of squeezing and depressing them."

Published by Globes [online], Israel business news - www.globes-online.com - on May 2, 2013

© Copyright of Globes Publisher Itonut (1983) Ltd. 2013

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