The Israeli foreign minister, David Levy, has stayed away from a cabinet meeting due to discuss the budget.

Mr Levy said last Thursday he intended to resign because the budget would harm the poor.

Since then the Prime Minister, Binyamin Netanyahu, has been attempting to find a compromise, but efforts appear to have failed.

Mr Levy has called a news conference for later today.

If he pulls his five-member faction out of the governing coalition it would leave Mr Netanyahu with a bare majority.

Correspondents say this would further hamper his ability to advance peace moves with the Palestinians, especially as Mr Levy has been the leading advocate in the cabinet for progress towards a settlement.

From the newsroom of the BBC World Service
 

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