The portion of the defense budget allocated for salaries, pensions, rehabilitation and payments to families is hitting a record high of NIS 18.6 billion this year - that's more than the total Public Security Ministry budget, Israel's higher education budget and the entire Social Affairs Ministry budget.
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In 2014 and the years that follow, the budget is expected only to grow.
Official Finance Ministry data from the online government database reveals new information about defense expenditures on salary-related expenses. These details, which were not public until now, explain to a significant extent the budget crisis awaiting the defense establishment in 2014.
According to official data the Finance Ministry published regarding the 2013 budget, the total defense budget is NIS 52.8 billion for the year. Total American assistance for the year totals NIS 9.9 billion. This means the total defense budget from Israeli sources comes to NIS 42.9 billion. Of this, NIS 18.6 billion – 43.4% - is on salary-related costs, including salaries, pensions, rehabilitation and payments for families. When the latter list of costs increases, this cuts into the Israel Defense Forces' budget for other items, including defense means.
These problems were not addressed by the security cabinet when it met last Thursday and unanimously approved a NIS 2.75 billion addition to the Defense Ministry budget for 2014. This was part of a compromise hashed out following the intervention of Prime Minister Benjamin Netanyahu. The addition was NIS 1.75 billion less than the ministry had demanded.
Thanks to agreements between former Defense Minister Ehud Barak and current IDF Chief of Staff Lt. Gen. Benny Gantz, the defense establishment’s pension budget shot up over the past few years, from NIS 4.4 billion in 2012 to NIS 6.1 billion in 2013 and NIS 6.8 billion in 2014 – an increase of 50%. The budget will also stay in this range for 2015 and 2016.
This kind of budget is a macroeconomic problem. Essentially, the defense minister and chief of staff spent the past few weeks fighting not for money to enhance the IDF’s fighting ability but for benefits for soldiers, particularly past and present members of the standing army. While they received support from the prime minister and the security cabinet, they will still need to seek more funding sources in order to pay for promised pension payments.
Furthermore, new figures show that salaries for the standing army will total NIS 10.4 billion this year - a quarter of the total defense budget from Israeli sources. Only four ministries have higher budgets – defense, education, health and public security. Clearly, cutting back on the IDF’s workforce will help reduce this budget item. But past experience suggests the defense establishment rarely upholds its end of the bargain. What will probably happen is that the IDF will cut staff on one end while hiring on the other end, and ultimately its workforce will grow.
The Brodet recommendations for 2008 to 2017 said the IDF had to cut NIS 30 billion via efficiency measures, and use that money to strengthen itself. But there are no plans within the defense establishment to implement that.