Finance Minister: We will take Agriculture Ministry in next government

Finance Minister: We will take Agriculture Ministry in next government

Welcoming key figure from farmer community into party and amid spat over dairy prices, Kahlon vows to ‘take responsibility for Israeli agriculture’

Stuart Winer is a breaking news editor at The Times of Israel.

Finance Moshe Kahlon speaks at a ceremony, August 20, 2018. (Meir Vaknin/Flash90)
Finance Moshe Kahlon speaks at a ceremony, August 20, 2018. (Meir Vaknin/Flash90)

Finance Minister Moshe Kahlon said Monday that in the next government his Kulanu party will demand to also hold the Agriculture Ministry, amid a spat over dairy prices.

Kahlon has been locked in a confrontation with current Agriculture Minister Uri Ariel (Jewish Home) over the pricing of dairy products.

During a tour of the Ramat Hanegev region in the south of the country, Kahlon welcomed to his party a key figure in Israel’s agricultural community, Secretary General of the Israel Moshav Movement and Director of the Israel Farmers Federation, Meir Tzur.

“In the next term in office the Kulanu party will take responsibility for Israeli agriculture, it will demand the agriculture portfolio, and will once again make it the stately and professional place it should be,” Kahlon said.

Tzur, who represents 354 agricultural communities, announced that he was joining the party.

There is an ongoing dispute between the Agriculture and Finance ministries on a scheme to raise the cost of basic dairy products whose prices are controlled by the state.

Agriculture Minister Uri Ariel speaks during a conference of the National Union Political party in Jerusalem, on March 6, 2018. (Yonatan Sindel/Flash90)

In May, the government price control committee recommended a hike of 3.4 percent in the price of controlled products which include milk, cream cheese, cream, butter, and some yellow cheeses.

Whereas Ariel has agreed to the price increase, Kahlon has refused to give his approval. The finance minister has made the cost of living a central plank of his political platform.

Earlier this month Israel’s largest dairy manufacturer Tnuva announced it was increasing the price of some non-controlled dairy products by an average of 2.2%, blaming Kahlon for not agreeing to the change in controlled prices.

Tnuva has also petitioned the High Court of Justice calling on it to instruct Kahlon to explain why he won’t agree to the price hike in controlled dairy items. A September court date has been set for initial hearings.

Ariel, reportedly further raised tensions when he blocked a deal hammered out between the Finance Ministry and Tnuva which would see the petition pulled in return for the treasury agreeing to increase the controlled prices if Tnuva makes no changes to the cost of non-controlled items.

Illustrative photo of milk and chocolate milk cartons. May 3, 2015. (Flash90)

Earlier this month Prime Minister Benjamin Netanyahu told fellow coalition party leaders that if the ultra-Orthodox parties don’t compromise on a military draft law within the next three weeks, he will call early elections, likely to be held early in 2019. The contentious issue has for years played a role in coalition politics.

Tnuva’s cottage cheese prices were at the heart of a consumer boycott of the company in 2011, when a Facebook group called on the public to stop buying the product, which is perceived as a basic staple in Israel. The protest sparked mass demonstrations on the cost of living in Israel and succeeded in lowering consumer prices.

In 2017 Tnuva was fined NIS 25 million ($7.1m) in a settlement after a years-long investigation into allegations of illegal business practices.

The food conglomerate, a major supplier of dairy and meat products, admitted that it carried out a scheme to force grocery chains to set prices it determined on Tnuva products in order to eliminate competition between 2008 and 2011.

Times of Israel staff contributed to this report.

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