Prime Minister Benjamin Netanyahu on Sunday announced he was establishing a ministerial team to hold a dialogue with the housing protestors . During Sunday's cabinet meeting Netanyahu promised to change the government's priorities "but in a responsible manner." The prime minister has thus far refused to hold such a dialogue.

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Some senior ministers described the move as "a slap in the face of the finance minister," explaining that the committee will in fact examine the Treasury's policy and conduct.

Meanwhile, Finance Ministry Director-General Haim Shani has announced his resignation. "It appears the prime minister withdrew some of the Treasury's authorities, and that caused the resignation," one minister said.





Saturday's mass protest in Tel Aviv (Photo: Yaron Brener)

"I have ordered the establishment of a special ministerial team to devise a practical plan to ease the financial burden," Netanyahu declared. "I am asking the team to set up a round table where representatives will hear the problems, proposals and solutions and put forward a plan to ease Israeli citizens' financial burden."

Netanyahu further added, "We in Israel can take the necessary steps as we have behaved responsibly on the financial level. Israel has witnessed growth in the past few years, our unemployment rate is the lowest in the Western world and these things enable the necessary changes."

Nevertheless, he warned that irresponsible actions may induce a crisis. "We must avoid rash and populist steps which may lead us to bankruptcy. We are all aware of the hardships and high cost of living in Israel. Some of the claims being made are justified and some are not. We have an obligation to deal with the true adversities in a serious and responsible manner."

Minister Eli Yishai said, "There is real distress: The rise in water, gas and food rates. All of the economic processes of the past 10 years have benefitted the strong, and not the weak and middle class. The government has done some good things but not enough."

Yishai said that the state should take a series of steps including lowering gas tax, and seeing to it that money is transferred to the middle and lower classes and not the upper classes.

National Infrastructure Minister Uzi Landau said that despite Haim Shani's "unfortunate resignation" the government is now more stable than in the past.

Attila Somfalvi contributed to this report