Special report: Israel-Lebanon Conflicts

    JERUSALEM, Sept. 3 (Xinhua) -- Israeli Finance Ministry on Sunday rejected most of the defense establishment's demands to increase its 2007 budget, Israel's newspaper Ha'aretz reported on its website.

    The treasury rejected the defense establishment's request to add 9.6 billion Shekels (1 U.S. dollar = about 4.4 Shekels) to its budget to better prepare for the country's next war, and denied its request for an additional 3 billion Shekels for the Defense Ministry's basic 2007 budget.

    However, the Finance Ministry agreed to the Defense Ministry's request to cover the costs of the war in Lebanon, saying it was willing to allocate 9 billion Shekels in coverage costs over the course of the next three fiscal years.

    Israeli Kadima ministers met Sunday to discuss the massive budgetary cutbacks planned by the government to cover the military costs of the war in Lebanon.

    Interior Minister Roni Bar-On said the proposed cuts would affect all citizens and bring about a general decrease in the standard of living.

    Bar-On warned that the government must make sure the financial burden is spread evenly on all parts of society rather than focus on any particular class. Enditem