In that blogpost, I raised the question if perhaps the MoF hadn't, in fact, ultimately influenced Israeli policy in East Jerusalem rather more than is generally recognized.
Today's document can't answer the large question, but it does demonstrate that other parts of the government intended to put up a fight. On page 1 of the file there's a letter sent out on July 18 1967 by Dr. Yosef Kukia, Director General of the Ministry of Justice (MoJ), to other secretary generals, explaining that the Committee of Ministers for Jerusalem Affairs had been shown the document about limiting service in East Jerusalem, and had countermanded it.
The service given in both parts of Jerusalem will be the same. The ministries are required to give these services, as stated by law. Additional services will be offered in accordance with the capabilities of the ministries.I'm not certain that was the last word in the matter, but it was a very clear word.
On a related matter: Moshe Sanbar (Sandberg), the MoF budget director who tried to limit the government's expenses, passed away earlier this month. He arrived in Israel as a destitute Holocaust survivor, held that important job in 1967, and went on to make a lifelong contribution of great significance to Israel's economy; whether he won this particular argument about Jerusalem or lost it, he certainly did his share for the country. May he rest in peace.