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Finance Minister Roni Bar-On said Monday that chances for an agreement over an extensive reform of the education system are diminishing because of the lack of progress in negotiations between government officials and representatives of the Secondary School Teachers Association.

Bar-On, who made the statement during his speech at the Israel Business Conference in Tel Aviv, said that the government is planning to invest funds in increasing the number of classrooms and additional school hours, but that "it is not up to the teachers' organization to decide what to invest in first."

Striking secondary school teachers, vowing to defy court injunctions to force them to return to classrooms later this week, disrupted a speech by Prime Minister Ehud Olmert at the Israel Business Conference in Tel Aviv.

Last week, the National Labor Court issued an injunction calling on the striking teachers to resume their jobs once the Hanukkah break is over. The court's ruling is meant to bring to an end the teachers' strike, which began nearly two months ago. At issue are demands over wages, reducing the numbers of students per class, and restoring teaching hours slashed by past budget cuts.

"We will not give in to the court's injunction," the teachers called during the speech, while hundreds more demonstrated outside the conference venue, the seaside the David Intercontinental Hotel.

The prime minister mentioned the government's increase in the education budget, but admitted that the current education crisis is "difficult," following years of budgetary cuts.

Olmert said while the teachers were right in their demand for better working conditions, "the government is right in demanding reforms in the education system."

"There is no escaping the damage of the last 15 years," Olmert said, adding: "The Israel teachers union has succeeded in raising a most tender subject in Israeli society." The prime minister called on teachers to resume discussions, saying: "The children want to go back to school."