The chairman of the Histadrut labor federation, Ofer Eini, said Monday that he would agree to cancel the public sector strike scheduled for later this week only if all local council employees were to receive their withheld wages by Tuesday, Army Radio reported.

Eini met Sunday night with the Interior Minister and the Finance Minister, who proposed transferring wages to all but 650 employees by Wednesday.

According to the Histadrut, some 5,000 employees in 35 local councils have had their wages withheld for months, despite ongoing negotiations and pressure on the government. Before their meeting Sunday, Eini had demanded that the government solve the crisis by Wednesday.

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Eini said Monday that Finance Minister Abraham Hirchson's proposal to pay all but 650 workers was reminiscent of a draft laid out by the treasury on the matter last November.

"The test this time is a test of results. If by Tuesday, the 20th of the month, as I promised the public, the employees have their wages in their bank accounts - there won't be a strike. But if they do not receive their wages - there will be a strike. I want an absolute solution," Eini told Army Radio.

The strike, scheduled for Wednesday, would affect all government offices, local councils, state companies, the National Insurance Institute, Employment Services, Ben Gurion Airport air traffic, train lines and the sea ports. Bus lines would continue to operate and bank branches would remain open to the public.

During deliberations, an argument broke out between representatives of the treasury and the Histadrut over the number of employees who have had their wages withheld. The treasury accused the Histadrut of exaggerating the figures, claiming that it is not more than 1,100 employees "who have not received their salaries in a regulated manner."

At the meeting Sunday evening, Hirchson and the treasury's supervisor of wages, Kobi Haber, presented a draft outline whereby the wages of all but 650 employees would be paid by Wednesday. In addition, NIS 18 million would be transferred to the religious council for the purpose of paying their employees. The treasury said that it would continue to develop "productive ways" to pay all of the workers, including the 650 which would have been excluded in the first phase of payment.

The Histadrut was unsatisfied with the treasury's offer, and said it considered no real progress to have been made in reaching an agreement.

At the end of the meeting, Hirchson, Eini and Interior Minister Roni Bar-On agreed to continue meeting until Tuesday.