Israeli spending plan passes preliminary Knesset vote

An Israeli austerity plan that caused a crisis in prime minister Mr Ariel Sharon's ruling coalition won initial Knesset approval…

An Israeli austerity plan that caused a crisis in prime minister Mr Ariel Sharon's ruling coalition won initial Knesset approval today.

The 17 members of the Shas Party whose opposition to the bill on Monday sparked a political crisis were absent from the vote. Mr Sharon ejected the party from his coalition on Monday. Israel Radio quoted Sharon aides as saying the dismissal would remain in effect once the Shas Party did not vote.

Parliament voted 65 to 26 in favor of the emergency economic package aimed at reining in a budget deficit swollen by falling tax revenues and higher defense spending stemming from a 20-month-old Palestinian uprising for independence.

In a stinging defeat for Mr Sharon on Monday, the Knesset rejected the 13-billion-shekel ($2.7-billion) package of spending cuts and tax rises. The legislation still needs to pass two more votes before taking effect.