According to Arutz 7:

Bus drivers providing the public with transportation are allowed to take up to ten standing passengers according to Israeli law, occasionally causing them to pass by and leave passengers waiting at bus stations until a less crowded bus arrives.
But thanks to the request of a hareidi resident of Elad, located east of Petah Tikva, that reality is a thing of the past.
The resident's request on the issue led Elad Deputy Mayor Rabbi Shmuel Grossbard, who holds the municipality portfolio on transportation, to urge the Transportation Ministry to listen to the man's solution to the problem.
Under the framework presented, drivers would be required to pick up all passengers at the stations.
For every trip in which over ten riders were forced to stand, the bus company would have to report to the Transportation Ministry, and if it occurred more than three times in the same hour, the company would immediately be required to add an extra bus on a fixed basis for the hour of high demand.
In a letter sent by the public inquiry department, it was noted "in the coming days a new guideline will launch relating to the limitations on picking up standing passengers."
"The message brought by the guideline is that the criminal sanctions (against drivers) for giving over ten passengers standing-room only rides will be cancelled," it added. "Only the financial traffic ticket will remain unchanged."
The statement continued "additionally around ten inter-city bus lines will be excluded and allowed to give up to ten passengers rides while standing without a fine. Also the ministry will continue to reinforce lines inundated with passengers so that the problem will not be repeated."

I think it is great that they will finally implement a system that will include the bus company having to regularly reevaluate what lines are busy and overcrowded and what lines or times are underutilized, and adjust accordingly, adding buses to times and lines that are overcrowded.

However, I don't get the first part, When Egged packs the people in, such as on lines to/from the Kotel, busy times between Jerusalem and other cities especially on Friday afternoons and Saturday nights, holiday seasons, etc. the haredi community complains about how Egged takes them for granted and just packs them in like cattle cars... and now when Egged implements a rule by which they no longer pack the passengers in but limit how many can ride standing, they demand that Egged be forced to pack them in with no limits.

Which is it? do they want to be packed in or do they want to ride comfortably and respectfully?