JERUSALEM (AFP) — Israel on Sunday approved a massive boost to the pensions of hundreds of thousands of Holocaust survivors and the elderly amounting to around 373 million dollars.

Prime Minister Ehud Olmert’s cabinet approved cross-the-board budget cuts in government ministries to cover the 1.5 billion shekel rise in social benefits for those who survived the horrors of Nazi occupation, officials said.

“Today’s government decision marks a historic and unprecedented arrangement that does great social justice to Israel’s Holocaust survivors and pensioners,” Welfare Minister Isaac Herzog said in a statement.

“This is an important step to bridge and correct the historic injustice.”

The plight of Holocaust survivors sparked outrage after Olmert’s office announced the state would pay grants of around 20 dollars each per month in 2008 to the estimated 120,000 needy survivors over 70 years old in Israel.

In recent months, Olmert has held intensive negotiations with representatives of the survivors to reach an arrangement for about 250,000 people living in Israel who are classified as Holocaust survivors.

In August, Israel’s government watchdog slammed state assistance to elderly Holocaust survivors.

Its report said around 143,000 of the 250,000 survivors do not benefit from any financial aid, while 50,000 receive state aid and 57,000 benefit from reparations from the German and other governments.