Prime Minister Benjamin Netanyahu’s move to disband the governing coalition and lead the nation to an early election is likely to cost the country around 2 billion shekels ($505 million).
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Giving people a day off to vote will cost the economy some 1.5 billion shekels, while financing the election committee will cost an estimated 220 million to 250 million shekels. Meanwhile, providing election financing to the country’s political parties will cost 250 million shekels.
But there will also be indirect costs. The budget bill will be frozen, so as of January ministries will be forced to work with the 2014 budget, with the only adjustments based on inflation. Thus all reforms or priority changes will be frozen as well.
Absent a budget, state money first goes toward paying off state debt, salaries and similar obligations, and the state cannot take on new obligations. There is a positive side to this – government spending would be limited during an election campaign.
If an election is held in March, a new government won’t be formed until April or May. The new government would then have to prepare a new budget draft, which would be submitted to the Knesset no earlier than May. From there the document would need another month or two to win Knesset approval.
This means the government would start operating under the 2015 budget no earlier than July. The budget would most likely be a biannual one, covering 2016 as well.
In any case, an election period isn’t necessarily a bad time for Knesset members, who can expect to be on vacation for a good six months.
Normally, a new Knesset meets about two weeks after an election, so the 20th Knesset would first meet in April – but parliament will be on Passover break until mid-May. Both outgoing and incoming MKs will be earning 38,887 shekels a month before tax the entire time they’re on break.
The move to disband the 19th Knesset a mere two years after an election means MKs who are not elected to another term will receive modest financial compensation. First-time MKs who are not reelected will receive the equivalent of one month’s pay. Veteran MKs who are not reelected will receive one month’s pay for every year they served, up to a maximum of six years – or 234,000 shekels.
Outgoing veteran MKs will also be eligible to have their phone and newspaper costs covered for the rest of their lives, for up to 10,000 shekels a month. Those who served only one term will have these expenses covered for only one year.