Prime Minister Ariel Sharon, responding to the American disapproval of the large budget allocations for the Yesha settlement enterprise, has cut it down by more than half. The original allocation was to be well over a billion dollars, but Sharon has now decided to make it $600 million, to be spread out over a number of years. The Yesha Council is up in arms, claiming that the Sharon government has essentially \"frozen\" the development of Judea and Samaria towns.



Yesha Council leaders will meet today with Interior Minister Eli Yeshai (Shas) regarding special security aid for the settlements under fire.



Foreign Minister Shimon Peres, on the other hand, says no. In a letter to his U.S. counterpart, Secretary of State Colin Powell, Peres writes that Israel refuses to accept the Mitchell Report\'s recommendation to cease settlement activity, as it would \"look like a reward to the Palestinians for their violence.\" Peres reviewed for Powell the government\'s guidelines, according to which no new towns will be built, but existing ones will be developed. He said that the Oslo agreements stipulate that the issue of Israeli towns in Judea and Samaria be discussed only in final-status negotiations.