The head of the right-wing secular Yisrael Beytenu party, Avigdor Liberman, branded the decision regressive "religious coercion."
The current minister is religious MK Bezalel Smotrich, a strong backer of Netanyahu and leader of the far-right National Union party.
"This is about power, bullying and religious coercion," Liberman said. "The man who wants to take us back to the time of King David, King Saul and Torah law, again proves that these are not merely empty declarations, but, unfortunately, deeds too," said Liberman, who has vowed Yisrael Beytenu will never join a coalition with the ultra-Orthodox parties.
"Smotrich, a member of a [party] that purports to represent the enlightened liberal right, has exposed its true face," he said.
"Yisrael Beytenu will demand as a precondition for joining the next coalition that the issue of public transportation and the opening of businesses on Shabbat will be the sole responsibility of local government."
Yisrael Beytenu MK Oded Forer, meanwhile, accused Prime Minister Benjamin Netanyahu of entrusting the ministry to supporters of his bid to seek parliamentary immunity for his criminal indictments.
"The local authorities, whose leaders are elected by the public, are the ones who must decide, and not those who are appointed as a reward for supporting immunity for the prime minister," Forer said.
"Smotrich, who serves as minister without the trust of the public or the Knesset, is confident that he can run everyone's lives and take another step to make Israel into a halakhic state." Read more at YNET