Rabin to cut cash aid for Jewish settlers

JERUSALEM - The cabinet of Israel's Prime Minister, Yitzhak Rabin, will rescind the benefits which the previous hardline government gave Jews to settle in occupied Arab lands, cabinet ministers said yesterday. The cabinet has set up a committee to re-examine the benefits which include discounts on taxes, mortgages, roads, power and water.

Mr Rabin's government, which took office promising to accelerate Middle East peace moves, has reversed plans by Yitzhak Shamir's former hardline coalition to build nearly 7,000 new homes in the occupied territories.

Referring to the Green Line separating Israel from the lands it occupied in the 1967 Six-Day war, Yair Tsaban, the Immigration Minister, said: 'In the future there will be fewer benefits, which will minimise the number of people moving from this side of the Green Line to the other.'

Asked if Israel had agreed to attend the peace talks in Washington next month, Moshe Shahal, the Communications Minister, told Israel Radio: 'We certainly intend to answer the invitation and stick to the schedule.' Mr Rabin, who hopes to win dollars 10bn in US loan guarantees, promises to use the funds freed by settlement curbs to create jobs for Israel's 11.6 per cent unemployed.

'Areas in Judea and Samaria (the occupied West Bank) close to the centre of the country will not get the same benefits and the same preference they got in the Shamir government,' the Health Minister Haim Ramon told reporters.

Abraham Shohat, the Finance Minister who received death threats after he and the Housing Minister Binyamin Ben-Eliezer announced the settlement curbs, said the warnings did not scare him. The halt to new building was condemned by Jewish settlers, more than 100,000 of whom live among the 1.75 million Palestinians in the disputed territories. Both ministers have been placed under 24-hour armed guard.