The Knesset plenum on Monday approved in a vote of 51 to 37 the reestablishment of the Religious Affairs Ministry, to be headed by Minister Yitzhak Cohen (Shas).
Members of the Knesset's Arab faction skipped the deliberations, bringing the vote to a head.
The vote, originally scheduled to be held last week, was delayed due to the opposition of both Yisrael Beiteinu and the Labor Party which prevented quorum.
Most members of Knesset from Labor voted against reviving the ministry, but the party's ministers voted in favor.
Yisrael Beiteinu MKs were split among supporters, opponents and absentees.
The government two weeks ago approved the separation of the religious services authority from the Prime Minister's Office.
The move was approved by a vote of 16 ministers in favor to six against. Two ministers abstained.
The original Religious Affairs Ministry was dismantled in 2003, under the Sharon-Shinnui government.
Prime Minister Ehud Olmert said during the meeting two weeks ago that there is "no intention of reestablishing the religious services authority in its previous format," and added that "until now, the matter of religious services was under my charge, but I don't think that a prime minister should devote hours every week to signing burial permits."
The Chief Rabbinate, the Rabbinical courts, and the religious schools will remain under the prime minister's control.
Prior to the vote, National Religious Party chairman Zevulun Orlev demanded the government reveal details of any back-channel agreements with the Arab factions, should such an agreement exist. Prime Minister Ehud Olmert denied Orlev's suggestion a deal was struck in exchange for their abstaining.
"The Olmert government is buying Shas in exchange for its survival at the taxpayers' expense," Meretz MK Zehava Gal-On said in reaction to the vote. "Once again jobs will be given to cronies and funds will be transferred to the haredim all on the back of the secular public."
"This shameful act of creating the Religious Affairs Ministry anew will no doubt deepen the corruption in the religious establishment," said Rabbi Gilad Kariv, associate director of the Religious Action Center of Reform Judaism. "[I call on] all candidates for prime minister to pledge that, if elected, he or she will dismantle the ministry immediately."
Cohen expressed satisfaction with the Knesset's approval, saying he will "focus starting tomorrow morning on payment of salaries to religious council workers and on a solution to the religious services crisis."
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