Israeli strike rages as talks stall

The strikes have disrupted air travel

Israel's public sector strike has spread to banks and the stock exchange after the finance ministry delayed talks with the Histadrut labour federation.

Histadrut officials said they were furious at finance Minster Binyamin Netanyahu's decision to postpone a meeting with their chairman Amir Peretz from Thursday evening to Friday morning.

Mr Netanyahu has also threatened to curb the right to strike as 700,000 public sector workers threaten to walk out.

"What is happening now is a scandal," said Mr Netanyahu.

"It's intolerable, and the end of these practices is only a question of time."

Minor breakthrough

Israeli workers are protesting at government plans to try and save 11bn shekels ($2.4bn) from the budget as Israel struggles with its worst ever recession.

Histadrut members have said the main stumbling block is the government's plan to raise the retirement age for women to 67.

There were signs of a turnaround on Thursday night as the Histadrut agreed to let the Israeli Treasury manage pension funds.

Mr Peretz said he would agree "to transfer management of the funds to the state, on the condition that an agreement ensures the rights of the fund members".

Plans to close Ben Gurion airport for 24 hours have also been called off.

Loggerheads

But tensions rose again on Friday morning as the meeting between Mr Peretz and the finance ministry started.

Histadrut officials suggested Mr Netanyahu had deliberately delayed the meeting to prolong the strike.

Mr Netanyahu had hinted on Thursday that the right to strike by union members could be curtailed.

"We are seeing the last strike of its kind, we can no longer give Histadrut the right to paralyse the country," he said.

Mr Peretz responded with equal fervour.

"We will not cede to these threats and we will continue our fight to defend salaried workers and pensioners," said the Histadrut chairman.