Last update - 00:00 02/11/2006
State budget in surplus as social service funding goes unused
By Moti Bassok, Haaretz Correspondent
Monies allocated to social services in the 2006 state budget have not been fully utilized, contributing to a NIS 2 billion budgetary surplus at the ten month point of 2006, the Finance Ministry reported on Thursday.
Israel's social service organizations have spent a mere 74 percent of their collective budget so far this year, according to a report released by the treasury's accountant general detailing the unexpected surplus. In contrast, the defense establishment has already used up 87 percent of its allocated 2006 budget, as the budgetary years slips to a close.
The inefficient implementation of the social services budget is due in part to poor management within the finance ministry, particularly within the ministry's accountant general and budget department. The ministry has delayed the transfer of funds to offices included in the allocated budget approved by the government.
Despite the treasury's delays, the social services which had initially fought against the budget cuts have made no effort to battle the ministry and receive their overdue funds.
Underspending in social services is not a new phenomenon. In recent years, the services used only 92 to 96 percent of their allocated budget while every shekel in the defense budget was used up in entirety. As a result, the treasury has gradually cut billions from social service budgets.
According to the treasury's report, the NIS 2 billion surplus was reached despite the NIS 1.9 billion paid to northern residents in compensation for damages incurred during the Lebanon war and despite the increase in the defense budget.
Another reason for the surplus is the unexpectedly high income tax revenue in 2006. During the first ten months of 2006, the government collected NIS 85.4 billion in direct income tax, 13.1 percent more than the previous year. The state collected NIS 10.7 billion more than the projected revenues at the beginning of 2006, on which the yearly budged was based.