The cabinet on Sunday approved a budgetary cut across all ministries for year 2007 totaling NIS 870 million to cover an increase to the defense budget and a few other commitments by the government.

The cut, amounting to 3.5 percent of the budget of each ministry, was executed following a NIS 1.9 billion addition to the defense budget. The remaining NIS 1.225 billion will be covered by the defense budget.

Twelve ministers voted in favor, Defense Minister Amir Peretz and Housing and Construction Minister Meir Sheetrit voted against, and all Shas and Labor ministers abstained in the vote.

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Prime Minister Ehud Olmert had ordered the budgetary increase for the Defense Ministry against the discretion of the Treasury and after refusing to wait for the recommendation of the Brodt commission on economic reforms. The commission is expected to submit its conclusions in April this year.

The cut seeks to give answer to immediate needs without exceeding the budgetary framework approved by the Knesset, which on Wednesday passed the 2007 State Budget. The cut across ministries was initially planned to be 2.5 percent and Finance Minister Avraham Hirchson said that a larger cut would hamper the operation of the various ministries.

Olmert's intervention to increase the cut to 3.5 percent aimed to allow a NIS 80 million addition to assistance for children at-risk and in order to meet financial agreements with the coalition parties amounting to NIS 115 million.

The cuts will not affect the budgets of welfare, employment, higher education, the construction of school classrooms, the health basket, long-term plans in the Arab sector and the rehabilitation of communities in the north damaged in the war with Lebanon.

The approved cuts spared entirely the Health Ministry and imposed only partial cuts on the budgets of the Education Ministry and the Ministry of Public Security.