Knesset Finance Panel Clears Israel's 2019 Budget Delayed by Coalition Dispute

Spending package due to go to plenum Tuesday, with final votes slated for Wednesday evening, if no new crisis erupts

Moshe Gafni, Member of the Knesset for the Haredi party United Torah Judaism. December 19, 2017.
Olivier Fitoussi

The coalition crisis that delayed approval of the 2019 budget still isn’t over, but the Knesset Finance Committee went ahead and approved the spending package late on Monday anyway after rejecting a host of reservations from opposition lawmakers.

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The 479.6 billion shekel ($139.3 billion) spending package as well as the Economic Arrangements Law is now due to go to the full Knesset to begin debate on Tuesday, barring any new eruptions over the Haredi draft-exemption law.

The Arrangements Law was approved by the Finance Committee last Thursday. The measures passed by the committee on Sunday also include adjustments to the 2018 budget.

The 2019 budget is on schedule to be voted nearly 10 months before it was go into effect, but Prime Minister Benjamin Netanyahu had sought early passage to ensure coalition peace as he faces multiple police investigations over alleged bribery and the threat of indictment in the months ahead.

Lawmakers said they hoped to complete the second and third votes on the budget and Arrangements Law by Wednesday evening, thereby meeting the deadline they had set before the crisis erupted.

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“The budget is both good and transparent. It doesn’t contain any [painful] spending cuts. The health budget is increasing dramatically,” said Moshe Gafni (United Torah Judaism), the committee’s chairman and Haredi legislator who had held up the budget vote until the conscription legislation ultra-Orthodox parties were demanding had been approved by the Knesset.

In the end they settled for a compromise that saw MKs approve the legislation in a preliminary vote, with the second and third readings delayed until the Knesset’s summer session. As of press time, Defense Minister Avigdor Lieberman insisted his Yisrael Beiteinu party would not support the conscription law.

The Haredi parties were also motivated to move forward with the budget the government approved at the start of the week with an extra 50 million shekels spending for yeshivas and 40 million for haredi educational schools, bringing the total state aid they get to 1.225 billion shekels. Gafni insisted the money didn’t represent extra spending but a rollback of spending cuts that had been in the original 2019 budget.

Opposition legislators raised suspicions that there were other, secret agreements to provide funds to favored projects of coalition MKs or parties. But Yogev Gordus, the deputy director of the treasury budget division, said that “based on the information available to the professional staff there are no additional amounts and we are inside the budget framework.”

Gafni noted that when the coalition parties had signed on a document several months ago saying they would make no additional demands on the budget beyond what was already agreed to in the pact forming the coalition in 2015, he declined.

“I said to them that I may want to change the budget. My job is to make changes in the budget, but none of the coalition agreements were reopened,” he said.

Among those changes was a 120 million-shekel increase in the budget for payments to Holocaust survivors, half of which will go to equalizing payments between widows and widowers whose spouses died before 2011 and the other half to equalize payments to those getting money from Germany and from Israel.

In recent years, Israel has significantly increased payments to survivors, creating a gap with those who get German government allowances.