Israeli Prime Minister Ehud Barak has rejected the request of Chief of Staff Shaul Mofaz for a real-term increase of a billion shekels in the military's budget for 2001, reported Haaretz newspaper.
The paper said that the main beneficiary of this decision will be the education budget, including higher education.
The military has based its request for on a promise from Barak that he would restore the billion shekels that were cut in this year's budget.
The Finance Ministry objected strenuously to the army's request, arguing that the military would save NIS 1.5 billion (approximately $375m) a year in the wake of the withdrawal from Lebanon.
Barak made the decision on Sunday, before leaving for the United States to attend the UN Millennium Summit, said the paper.
Officials from the defense ministry and Barak's office had no comment on the report, said AFP.
At more than nine billion dollars, defense spending still accounts for a large slice of the 50 billion dollar budget for 2001, which was approved by the cabinet in mid-August.
It is due to be considered by the Knesset, or parliament, after it returns from its summer break in late October before it can go into effect January 1st, said the agency.
However, Barak currently has no majority in the 120-member house and faces the prospect of early elections.
Israeli arms manufacturers claimed last month that the industry was threatened with extinction by a drop in orders from the defense ministry.
"Cuts in the Israeli defense ministry budget and the resulting fall in orders of 25 to 30 percent could deal us a fatal blow," the head of the association of Israeli arms producers, General Herzl Bodinger, told a press conference - (Several Sources)
© 2000 Al Bawaba (www.albawaba.com)
