Before Israel's Election, Parties Loath to Talk About Cutting Defense Spending

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Soldiers in an army deployment area near the border with the Gaza Strip, July 13, 2014.Credit: AFP

Less than two weeks before the election and Israel’s political parties are vying for voters on a host of socioeconomic issues. But no party has touched the contentious issue of defense spending.

Economically speaking, that doesn’t make sense. At some 100 billion shekels ($25 billion) a year, security spending is the single biggest item in the budget. But no party, from Likud on the right to Meretz on the left, has said a word about the issue in this winter’s election campaign.

Four years ago, the Trajtenberg committee on socioeconomic change recommended cutting 3 billion shekels from the defense budget to help fund civilian spending. In the wake of the 2011 social protests this proposal won wide support and was approved by the cabinet, but it was never put into effect.

Today the committee’s chairman, Manuel Trajtenberg, is Zionist Union’s candidate for finance minister, but that outfit has kept quiet too.

Moshe Kahlon of the Kulanu party and Yair Lapid of Yesh Atid, who both promise to shake up socioeconomic policy and help the poor and middle classes, haven’t addressed military spending cuts and efficiency measures that would help pay for the stepped-up social spending they envision.

A 10% reduction in the defense budget would free up more than 6 billion shekels. The 2015 budget was approved by the cabinet but never got past the first of three votes in the Knesset before the government called the election.

In fact, the last word from Likud on the matter came from Defense Minister Moshe Ya’alon, who has warned he will seek a supplement to the 2015 defense appropriation. He said defense operations would come to a halt midyear this year, as they did in 2014, without an extra 5.6 billion shekels.

Actually, in 2014, the defense budget grew as a percentage of gross domestic product after years of decline — to 6.4% from 5.6% in 2013. The defense budget last year, after a 7-billion-shekel supplement to help cover the Gaza war over the summer, reached a record 70.45 billion shekels.

But even before 2014, Israel was spending two to six times other developed economies, measured against the size of its economy. As a result, the government doesn’t have enough money for schools, health care and infrastructure, says the Organization for Economic Cooperation and Development, of which Israel is a member.

Whether any of this changes will depend on two factors – who becomes defense minister after the March 17 election and the recommendations of the Locker committee, which was set up to craft a multiyear budget for the military.

Ya’alon, a former chief of staff and defense-spending hawk, is keen to retain the portfolio, and there is a very good chance he will if Benjamin Netanyahu remains prime minister.

Another possible candidate is Habayit Hayehudi leader Naftali Bennett, while Zionist Union’s likely candidate is Amos Yadlin, a former head of Military Intelligence. Both are seen as more inclined to free up military spending for other purposes.

The Locker committee, headed by Gen. (res.) Yohanan Locker, was supposed to present its recommendations at the end of last year after the 2015 budget had been approved. It will now wait until a new government is formed, which means its ideas could be incorporated into a revised 2015 defense budget, sources close to the panel say.

If the panel recommends significant cuts in military spending, there’s no reason to assume a Netanyahu-led government would accept it based on past performance. On the other hand, a Zionist Union-led government might reject the findings because the committee was appointed by a Likud government and start the whole process over again.

In any case, one area where the committee will seek savings is the military’s budget for pensions and rehabilitation. Both items have grown sharply in recent years — the pensions budget to 7.4 billion shekels last year from 4.5 billion in 2011, and the rehabilitation budget to 5 billion shekels from 2.9 billion in that period.

Defense officials have opposed shifting responsibility for these items to the civilian side, even though this spending has been taking up a growing share of their budget. They fear that with civilian oversight, benefits will be reduced.

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