The dramatic changes on the international scene - the collapse of the Soviet Union and the end of the Cold War; the opening of the gates of the former Soviet Union and the mass immigration of its residents to Israel; the military strike against Iraq effected by the United States and its allies - all these have created new and great possibilities for advancement in all areas of life in the State of Israel.

The policies of the Government and the national order of priorities will be directed toward seizing the opportunities to realize the central goals of the State of Israel. The central goals of the Government are: national security and personal security; peace; the prevention of war; the war on unemployment, via the creation of jobs, which will enable the absorption and strengthening of immigration; the prevention of emigration; economic growth; the fortification of the foundations of democracy; the rule of law; the promise of complete equality for all citizens; and the observance of human rights.

2.1. The foreign affairs and defense policy of the Government will ensure the independence of the State; the bolstering of its security; and the establishment of peace with its neighbors.

2.2 The Government will be diligent in strengthening and preserving the power of the IDF, its deterrent capability and its ability to withstand any military threat.

2.3 The Government will act forcefully against all terror and violence. The IDF and the security forces will act toward the maximal reduction of the level of hostile activity and toward the maintenance of personal security for residents of Israel and

residents of the territories, while adhering to the observance of law and of human rights.

2.4. The Government will provide residents of the settlements in Judea, Samaria and Gaza with their existential and security needs, and with municipal services.

2.5. Peace will be established on the basis of recognition, by Arab states and the Palestinians, of Israel as a sovereign state in the region and of its right to live in peace and security.

2.6. The Government will advance the peace process in the region with representatives of Arab states and the Palestinians, without any preconditions.

2.7. The Government will offer to continue the peace process with the Arab states and the Palestinians in accordance with the framework and the schedule formulated at the Madrid Conference. The Government will work for the acceleration of the negotiations and for the conducting of continuous discussions between the parties.

2.8. In the negotiations with the Palestinians, the Government will propose - as an interim arrangement - a program for the implementation of self-administration for the Palestinians in Judea, Samaria and Gaza. The Government will refrain from courses of action and activities that will obstruct the proper conduct of the negotiations.

2.9. The Government will reinforce and strengthen settlement along the confrontation lines.

2.10. The Government will work toward the creation of the new Middle East, in which resources are no longer devoted to the arms race, but to development - grounded in economic, cultural and scientific cooperation. Progress in the peace process must be accompanied by the creation of systems for regional cooperation.

2.11. The Government will concentrate efforts to deepen and improve the special relations of friendship which exist between the United States and Israel.

2.12. The Government will strive to strengthen and improve relations with the European Community and its member-states. In addition, it will work toward the strengthening of relations with Russia, the Commonwealth of Independent States, China, and other states.

2.13. The Government will make efforts to cultivate friendly relations and reciprocal ties between Israel and all peace-loving countries.

2.14 The Government will continue to view Egypt as an important partner in efforts to establish peace in our region and will work for the advancement of understanding and friendship between the Israeli and the Egyptian peoples.

2.15. The Government will uphold all the international commitments of the State of Israel.

3.1. The Government will alter the order of priorities in the allotment of financial resources from the State budget and from funds which arrive from abroad. First priority will be given to the war on unemployment and to strengthening the social and economic systems.

3.2. The map of development towns and areas will be reclassified, with communities on the confrontation lines and development areas that are distant from the center of the country being accorded preference over areas in Judea, Samaria, and Gaza, which are close to the center of the country.

3.3. In determining the level of assistance given to communities in different areas, a major consideration will be the distance of communities from the center of the country and their being confrontation areas.

3.4. All other budgetary commitments of the State of Israel, vis-a-vis the implementation of housing, infrastructure and development starts in Judea, Samaria and Gaza will be re-examined, in accordance with criteria detailed in the guidelines - in articles 3.2 and 3.3 above; according to budgetary ability; and with consideration to the legal situation.

United Jerusalem - the eternal capital of Israel - will remain united and totally under Israel sovereignty. Free access to the holy places will be ensured for members of all religions at all times, and freedom of religion will be guaranteed.

5.1. The Government will work toward the absorption of the immigrants who have arrived in Israel, by the creation of social, economic and spiritual conditions for the realization of the central purpose of the State of Israel - the ingathering of the exiles of the Jewish People in its homeland,

5.2. The Government will ensure that the "absorption basket" and other forms of aid to immigrants will be of an appropriate level to guarantee immigrants their basic necessities during the most difficult first period. The Government will take particular care of weak groups among the immigrants, such as pensioners. The Government will diligently enforce the social laws which protect the rights of immigrants.

5.3. The Government will work toward the resumption and increase of immigration from Russia and from other countries of the Commonwealth of Independent States.

5.4. The Government will increase its efforts to complete the immigration of Ethiopian Jewry, and their full economic and social absorption.

5.5. The Government will continue the efforts to rescue persecuted Jews and bring them to a safe haven, and enable them to realize their right to immigrate to Israel.

5,6 The Government views the phenomenon of emigration from Israel - particularly among the young generation - as a negative and damaging phenomenon, and will work to prevent it.

6. 1. The unity of the nation and the proper functioning of society require the cultivation of tolerance; harmony among all facets of the nation; and freedom of conscience and religion. The Government will refrain from any religious or anti-religious coercion by any party and ensure public religious services for the residents, without regard to political inclinations.

6.2. The Defense Minister will appoint a team, under his leadership, which will examine and determine the criteria of granting postponements of military service to those studying in religious academies, to prevent the negative exploitation of existing arrangements in this area.

7. 1. The Government views the guarantee of employment as a fundamental right of all citizens and will put the struggle against unemployment at the top of its economic and social order of priorities.

7.2. The Government will strive to develop a modern, developed and flourished market of a high technological and industrial level, in order to facilitate the maintenance of a modern welfare state. The effort to achieve these goals will advance a higher standard of living for the residents of Israel; the disadvantaged areas; and the reduction of social gaps.

7.3. The Government will work to develop the economy, to increase the rate of economic growth and to create employment for the hundreds of thousands of immigrants and residents who will enter the work force in the coming five years.

7.4. The Government will work toward adapting the economy to open management, free of administrative restrictions and excessive Government intervention in market and economic life.

7.5. The Government will promote the sale of enterprises under its ownership, while maintaining a dialogue with the employees, guaranteeing their rights and giving them the option - when possible - to acquire stock in the companies being sold. The Government will maintain control over companies engaged in the management of the natural resources of Israel; over natural monopolies such as the Mekorot Water Company and the Electric Corporation; and over sensitive defense industries.

7.6. In order to advance the Israeli economy toward full employment, while maintaining the stability of the market, there is a need for dialogue between the Government, the Histadrut trade union and the economic organizations. This dialogue must be institutionalized (Economic Social Council) and constant.

7.7. The Government will direct the major part of its investments toward the implementation of essential projects aimed at creating an advanced infrastructure in transportation, electricity, communications, water and sewage, high-tech industries, and research and development.

7.8 The Government will work toward shortening procedures which burden the business sector, as well as individuals.

7.9. The Government will implement a policy of controlled exposure of the economy in order to increase its efficiency and improve its products.

7.10. The Government will work to defend the consumer through limitations, the supervision of monopolies, and the prevention of restrictive arrangements, including monopolies over the import of products and merchandise.

7.11. The Government will work toward the separation of the government and public markets from party mechanisms. The Government will initiate the legislation of a law on the procedure for the appointment of directors and senior managers, based upon the conclusions of the Gabbai Commission.

7.12. The Government will take all measures necessary to improve the collection and payment of real tax.

7.13. Existing arrangements for the reduction of the cost of labor will be re-examined.

7.14. The Government will grant temporary incentives to businesses which will lead to increased employment, and views the mobility of workers and the preservation of their rights as a positive solution to the problems of unemployment.

7.15. The Government will work toward the creation of State and other tools which will encourage the growth process of small businesses.

7.16. The Government will work toward the determination of a basket of social services (education, health, welfare and housing) which will be granted to all citizens in accordance with the law.

7.17. The Government will initiate the legislation of a State pension law that will include all workers. Wage-earners and independents will be able to be members of the pension fund of their choice. Pension funds will be administered under Government supervision.

7.18. The Government will renew the nutrition program for school children in order to ensure that every child in Israel enjoys at least one hot meal per day. In the first phase, the program will be renewed in development towns and disadvantaged neighborhoods.

7.19. The Government will work toward the cultivation of city neighborhoods by raising the physical and cultural quality of life and by guaranteeing a basket of neighborhood services, which will meet education, health, welfare and leisure needs.

7.20. The Government views development towns as a pioneering and Zionist creation and sees their strengthening and constant development as a central national goal. The Government will grant priority to the consolidation of development towns by instituting a gradual incentive policy for all development areas, while placing emphasis on the comprehensive development of the Galilee and Negev areas to the benefit of all their residents.

7.21. The Government will legislate a comprehensive national health insurance law which will guarantee the rights of the patients and the public funding necessary for the maintenance of a modern and equal public health system of a high level.

All citizens of Israel will enjoy health insurance, within the framework of which they will receive all necessary health services for healing, basic prevention and rehabilitation. The insurance will be instituted via the public health funds which will observe fixed and uniform rules as will be required by law.

7.22. The Government will work toward the implementation of reform in the capital market, including the reduction of Government intervention in this market; the development of a risk-capital market; and the controlled opening of the Israeli capital market to international fluctuations.

7.23. Means to shorten the waiting list for welfare hospitalization in institutions for mental patients will be examined.

7.24. The Government is committed to the realization of equality between men and women in all areas of life -including wages, employment and taxation - and will prevent all forms of discrimination.

7.25. Special steps - and, where necessary, legislation - will be taken in order to guarantee the complete equality of the real wages of women and men.

7.26. An inter-ministerial team will be established to deal with the matter of family violence against women and children, while fully implementing the law on the prevention of family violence, with the assistance of social and community services.

7.27. The Government will assist women in realizing their capabilities in order to advance in management positions in the various systems.

7.28. The Government will work toward the bolstering of the system of services available to the working family, including the establishment of day-care facilities and the institution of a long school day track in all educational institutions.

8.1. The Government will act to accord priority to public construction. The Government will work to ensure housing for new immigrants and housing solutions for young couples, while granting priority and aid to demobilized soldiers, taking into account their economic and family situation. Housing solutions will also be provided to those families living in overcrowded conditions. Criteria for aid will be determined to ensure that the aid given by the State to those eligible will allow for adequate housing for young couples, immigrants and veteran citizens.

8.2. Ways of releasing lands from the Israel Lands Authority for construction will be evaluated, with the goal of reducing the price of land for construction.

8.3. The Government will encourage industrialized construction and will aid companies committed to cheap industrialized construction and construction for rental purposes, and will act to reduce bureaucratic procedures in the granting of building permits.

8.4. The Government will act to ease the burden on mortgage sufferers.

8.5. The Government will act immediately toward the construction of rental apartments at a price which young couples and the homeless can afford and will view this as the preferred solution for the housing problems in Israel.

8.6. The total amount of the mortgage for all those eligible will constitute a significant part of the apartment purchase price.

9.1. The Government views education as the central factor in the shaping of the image of the future generation of Israel. The imparting of knowledge, moral norms, human and national principles, will aid in the building of a productive and just society.

9.2. The Government views investment in education as an investment in the human capital of the state, and will act towards the allocation of adequate resources to ensure proper education on all levels, from infancy through elementary, secondary and higher education.

9.3. Education will be based on the eternal values of the people of Israel; on the values of democracy, tolerance and human culture.

9.4. The Government will act methodically and emphatically to bridge the educational and social gaps through education, making education a tool for bridging the contradictions and polarization in Israeli society. The Government will strive toward the full integration of all immigrant communities in Israeli society.

9.5. The Government will conduct a long school day within the entire education system. The Government will make an effort to implement a long school day already in the coming year in development towns and neighborhoods.

9.6. The Government will ensure equality in all the educational streams at all levels.

9.7. The Government will base the scope of the budgets, including the budgets for development of culture and for elementary, secondary, and higher education, and for yeshiva and religious school students, on an equal and uniform basis. The Prime Minister will appoint a committee to evaluate and implement the above paragraph.

9.8. All special allocations will be cancelled. The Law for National Economy Arrangements (amended) of 1992 will be implemented in full.

9.9. The Government will encourage special education programs on the subject of tolerance and coexistence.

9. 10. The Government will act toward the improvement of the learning conditions and of the teaching level in Arab and Druze villages and will assure them conditions equal to those of schools in the Jewish sector.

9.11.

A. The Government regards higher education and institutions for higher education as a central incentive for the scientific, technological and cultural progress of Israel, which constitutes an important support for the economic and social prosperity of the State.

B. The Government will act to increase the absorption capability of the institutions of higher education to ensure that every student can study regardless of his or her economic situation. The research budget in institutions for higher education will be increased.

9.12. The Government will act to encourage and develop religious education and culture.

9.13. The Government will act to encourage original Israeli creativity in all spheres -- literature, arts, theater, film, television and other fields. The resources granted to cultural institutions and their distribution will guarantee the above goals and their independence from the Government.

9.14. The Government will promote the study of the arts and of aesthetics from an early age.

9.15. The Government will allocate financial resources to the unions and sports ,organizations, the development of competitive sports, the support of performance sports and the absorption of immigrant trainers and sportsmen in every context.

The Government regards settlement in all its forms, as an undertaking of crucial value, to be consolidated and strengthened. The Government will adopt an agricultural and economic policy which will enable settlement to confront the special problems it faces.

11.1. The policy of the Government of Israel will be directed towards the full integration of the Arab and Druze citizens in Israel in all aspects of life while respecting their religious and cultural distinction and guaranteeing equality for all citizens of the State.

11.2. The Government will act to close the gaps between the Jewish and Arab populations in the fields of education, welfare, industry and crafts, agriculture, housing, youth and health services.

11.3. The Government will act to equate the budgets of the Arab, Druze and Bedouin authorities to those of the Jewish authorities.

11.4. Special efforts will be made to absorb Arabs and Druze, especially academics, in the civil service and other public institutions, in all levels of administration in order to include them in positions of national and public responsibility.

11.5. The Government will act toward the final approval of the master plans for Arab, Druze and Bedouin settlements.

11.6. The Government will examine the problem of unrecognized Arab settlements and will accelerate the approval of plans to extend the existing Arab and Druze villages, in order to solve the housing problem.

11.7. A special committee on Moslem religious property will be established, to arrange for its administration by the Moslem community, in the same manner as the property of other communities is administered.

11.8. The Government will act to find an arrangement for the Bedouin problem in the Negev, which shall be based on a combined solution to the lands problem and that of Bedouin settlement.

11.9. The Druze community has linked its fate to the Jewish people and the State of Israel and has strengthened this link by the compulsory service of Druze and Circassians in the IDF. The Government will act toward the completion of a law of equality for Druze and will implement a special program for demobilized Druze soldiers in housing and employment.

12. 1. The Government will act to guarantee the values of social justice, equality, liberty, responsibility for one's fellow man, integrity, the fostering of mutual respect between men and creation of a democratic entity, equal rights to all residents regardless of religion, race, nationality, or sex.

12.2. The Government will complete the legislation of the Basic Laws in order to formulate a constitution.

12.3. The possibility of changing the Emergency Defence Regulations in Israeli law will be examined.

12.4. The Government will discuss the State Comptroller's report, will draw conclusions from the criticism and will act to correct deficiencies, to maintain orderly administration, and to eradicate corruption.

12.5. The Government will combat crime and violence and will act to inculcate the recognition of the supremacy of the rule of law.

12.6. The Government will persevere in expanding the independence of local Government and the reduction of its dependence on the central Government. The Government will set permanent, clear and equal criteria for the distribution of funds by the Interior Ministry and the Treasury to local authorities and will supervise their implementation.

12.7. The Government will act toward the strengthening of the status and rights of the citizen through the implementation of the recommendations of the Kubersky Commission on the Civil Service on all issues, including the limitation of the use, of information on citizens.

12.8. In light of the negative incidents and shortcomings revealed in the functioning of the regime in Israel, the Government will act toward the strengthening of democracy, the implementation of the law for the direct election of the Prime Minister, the change of the system of elections to the Knesset, with the goal of reinforcing the operational capabilities of the Government and strengthening the connection between the electorate and the elected.

12.9. The Government will act to prevent politicization of the public administration, to assure the civil status of public service workers, and will strictly ensure that public administration employees behave according to acceptable norms.

12.10. The Government will allocate resources for the improvement of conditions in prisons and detention facilities.

12.11. The Government will guarantee the independence of the Broadcasting Authority. Public state inspection of the electronic media will be done with no political intervention.

The Government will protect the environment, will act to prevent the pollution of water and air and will act to eradicate or reduce the various ecological hazards of toxic materials and nuclear radiation.

14. Transportation 14.1. The Government views as unacceptable the increasing traffic bottlenecks and will act toward a solution of the traffic problem.

14.2. The Government will give priority to the struggle against road accidents and will allocate resources to deal with the causes of such accidents.

14.3. The Government will pave access roads to Jewish, Arab and Druze settlements throughout the country, according to priorities to be determined.

The Government will pass the demobilized soldiers law, which will guarantee rights to every demobilized soldier in the areas of employment, housing, education and professional training.