Members of Israel’s ruling coalition have presented Defense Minister Benny Gantz with a compromise to end an impasse in budget talks with Prime Minister Benjamin Netanyahu, which If accepted would prevent the parliament’s dissolution at the end of August.
According to the proposal, the government would approve a two-year budget, as Gantz demands, but the Knesset would only vote on the parts of it that are relevant for 2020, as Netanyahu initially wanted. This would give the government until March to reach final agreements on its 2021 budget.
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With a late-August deadline bearing down for the Knesset to approve a 2020 budget, the approval process was ground to a halt amid political squabbling between Netanyahu and Gantz.
By law, a government that takes office during a year when no budget has been passed must push through its own budget within 100 days, or the government falls. The current government was sworn in on May 17, so the 100 days end in late August.
The main dispute blocking the passing of a 2020 budget is the demand by Gantz, the head of the Kahol Lavan party, to pass a two-year document, as stipulated in his party’s coalition agreement with Netanyahu’s Likud.
Netanyahu, however, is keen to pass a 2020 budget only, after which work could begin on a framework for 2021.
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Under this scenario, if a 2021 budget is not approved by March 31, the Knesset will be dissolved and an election will be held in the summer, with Netanyahu remaining as caretaker prime minister. If the government collapses in any other scenario, Gantz would be caretaker prime minister.