Jerusalem, June 11, 2003

Cabinet Communique
(Communicated by the Cabinet Secretariat)

At the weekly Cabinet meeting today (Sunday), June 11, 2003:

1. Prime Minister Ariel Sharon referred to yesterday’s security activity and made it clear that insofar as terror is concerned, there will be no concessions, adding that he has made this clear in all of his conversations with the White House and the US State Department. These clarifications have been made over the years, were made at Aqaba, and have been made to all leaders and countries which maintain ties with Israel.

Prime Minister Sharon emphasized that yesterday’s security activity was a test of the credibility of the government and its statements. Given that Palestinian terrorist activity has increased, it must be clear that Israel will, under no circumstances whatsoever, make concessions regarding counter-terrorist operations; it is Israel that will decide what steps are appropriate in dealing with terror.

Prime Minister Sharon said that there is nothing in Israel’s security activity that is against peace since it strengthens the possibility of peace and because there can be no progress towards peace as long as terror exists. The Prime Minister noted that this approach was made clear to the Palestinians as well, a few days before the Aqaba summit. Insofar as Israel’s credibility is concerned, it must be clear that Israel has reiterated this position time and again.

2. In light of the need to carry out further adjustments in the 2003- 2004 state budgets due to the changes that have been made in Israel’s economic recovery plan, the Cabinet has begun to discuss a proposal to reduce each ministry’s budgetary base by 2% in both 2003 and 2004. This reduction will also apply to those budgetary outlays that stem from government decisions. However, those expenditures which are anchored in legislation and agreements will not be affected. The Cabinet has yet to conclude its discussion of the aforementioned proposal.