Tzipi Livni
Tzipi LivniFlash 90

After the negotiations she conducted with the Palestinian Authority fell apart several weeks ago, Justice Minister Tzipi Livni suffered another setback Sunday when a law that she had pushed that would have put the Jewish National Fund under the supervision of the State Comptroller's Office was defeated in the Ministerial Law Committee. Ministers of the Likud, Jewish Home, and Yisrael Beteinu defeated the bill, which was supported by Livni, Finance Minister Yair Lapid, and Health Minister Yael German.

The idea for the bill cropped up last year as Livni's response to alleged “racism” by the JNF, which has been accused of giving priority to developing land for Jewish towns over Arab towns, especially in the Galilee and the Negev. JNF officials were opposed to the law, fearing it would jeopardize the organization's tax-exempt status abroad.

Currently the JNF is considered a non-government organization, but if it is responsible to the government, it could lose that status in several countries, officials said.

Interior Minister Gideon Saar proposed a compromise plan, in which the ministers would discuss the law again in the summer after changes reflecting the concerns of ministers opposed to it were incorporated, but that plan was turned down as well.

Livni said she would appeal the rejection of her law, and try again.