אבוג'ן השלימה אבן דרך בפיתוח של זן חיטה בעבור באייר הגרמנית

The Histadrut is close to reaching a dead with the treasury over the government's economic austerity plan, Israel Radio quoted the labor federation as saying Friday.

Histadrut chairman Amir Perez met for a third meeting with Finance Minister Benjamin Netanyahu in the last 24 hours Friday, at treasury headquarters in Jerusalem. The meeting was held after teams representing the sides met earlier in the morning, and was also attended by treasury minister Meir Sheetrit.

But the head of the Histadrut negotiating team, Shlomo Shani, also warned Friday that huge gaps still existed between the sides. He said that it appeared that the public sector salaries would undergo a 3-4% cut, despite an initial treasury demand of a 6% reduction in wages.

After the meeting, the director-general of the treasury, Ohad Marani, told Israel Radio that the two were likely to hold a further round of talks Saturday evening. Marani said that he was cautiously optimistic, despite the threat of a strike by government workers scheduled to begin Sunday.

According to Marani, Saturday's meeting would set the tone for the rest of the negotiations.

Before entering the meeting, Perez told reporters that he was hopeful that the Netanyahu was not planning any surprise moves that could torpedo the talks.

"I think we have made fair compromise offers and I believe there is a good chance of reaching an agreement," Perez said.

Talks between the Histadrut and the Finance Ministry were renewed Friday morning, after a marathon overnight session failed to summount the difference between the sides over ther treasury's emergency economic plan.

After the overnight meeting - described by participants as 'critial' - the sides were still at loggerheads over several key issues, including the size of the pay cut in the public sector, and the number of civil servants slated to lose their jobs.

The first round of talks Thursday afternoon ended with a cloud hanging over efforts, after Netanyahu decided to withhold salaries of those public sector employees taking sactions. Going in to the late-night talks, Perez threatened that the strike would resume should the negotiations become deadlocked.

Following the meeting, Minister at the treasury Meir Sheetrit said that the two had come to realize during their talks the breadth of the gaps between them, but estimated that they would reach an agreement in the coming days.

Government workers said Thursday evening they would renew their strike Sunday to protest the treasury's decision not to pay some 3,800 workers if they continued with their work sanctions. Netanyahu said the treasury's decision had been made in coordination with the Justice Ministry, which denied the claim.

Perez said earlier in the day that every time Netanyahu heard that progress had been made in the negotiations, he took a decision bound to muddy the atmosphere and make it difficult to bridge differences, Israel Radio reported.

According to senior officials in the Justice Ministry, the issue of withholding the strikers' pay was discussed at Sunday's cabinet meeting. Attorney General Elyakim Rubinstein was asked to look into the matter.

The Justice Ministry also investigated the issue - and then, officials said, instructed the treasury that sweeping sanctions could not be imposed against workers who provide services to the public, as the treasury had proposed, but could only be done in a specific manner, in accordance with ministers whose offices would be affected by the decision.

The treasury, Justice Ministry sources said, did not coordinate its decision with ministers. Justice Ministry officials expressed bitterness over the treasury's announcement, specifically regarding the manner in which it chose to deal with workers who provide services.

The unions are protesting several elements of the treasury's new economic program.

The head of the trade unions' division of the Histadrut, Shlomo Shani, told Army Radio that he was "surprised" by the move and that the labor federation would "respond accordingly."

Netanyahu's decision - which the treasury said was coordinated with the Justice Ministry - came despite the impression on the eve of Independence Day that there was progress in talks between the two sides. Sources close to Netanyahu, however, said that while progress had been made, the talks were still far from producing any concrete results.

The heads of two unions announced Wednesday that they oppose cranking the sanctions back up to a full-scale strike, such as the one that shut down the country last week.

"Holding another strike would be like directing 'friendly fire' against the workers in whose names we are fighting to change the sections of the economic plan that deal with wages and dismissals," said Yitzhak Raz, head of the engineers and technicians' union. "All the anger would be turned against us."

Asher Goldberger, head of the paramedics' union, added that the Histadrut wants to avoid lawsuits for damages caused by the strike, which would probably be filed if the strike were resumed.

But both Raz and Goldberger stressed that there are still significant gaps between the Histadrut and the treasury. For instance, the Finance Ministry wants to cut public-sector wages by an average of 11 to 14% for the next three years, while the Histadrut objects to any cut, and is at most willing to freeze wages for 12 to 18 months.

In contrast, both men believe it will be possible to reach an agreement on dismissals. The treasury, they predicted, will ultimately drop its demand for cuts in the public-sector work force, "since they understand that substantial layoffs mean allocating financial resources to unemployment payments," and the Histadrut is willing to accept a hiring freeze.

Another outstanding dispute involves the treasury's plans for pension reform.