Knesset's 2019 Budget Talks: A Test of Political Fortitude

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Prime Minister Benjamin Netanyahu is seen at the Knesset during a special session marking 40 years since Egyptian president Anwar Sadat's visit. November  21, 2017
Prime Minister Benjamin Netanyahu is seen at the Knesset during a special session marking 40 years since Egyptian president Anwar Sadat's visit. November 21, 2017 Credit: GALI TIBBON/AFP

At 4 A.M. Friday, treasury officials were disappointed to learn that Prime Minister Benjamin Netanyahu was taking a two-hour break from the marathon budget talks that had begun the morning before. The officials were left with an audience of one – their boss, Finance Minister Moshe Kahlon.

Eventually Environmental Protection Minster Zeev Elkin entered the room and asked a few questions, and when the time to vote finally came a couple hours later, Netanyahu and Agriculture Minster Uri Ariel arrived.

Officially, Israels cabinet unanimously approved the 2019 draft budget of 479.4 billion shekels ($140 billion), but nearly all the ministers left a written note with their vote and werent on hand for the actual decision.

Cabinet all-nighters are standard practice for Finance Ministry budget planners, a time-tested tactic of wearing down ministers to approve the spending package before it goes to the Knesset Finance Committee on the way to a final vote in the full plenum.

The spoils go to those who have the wherewithal to make it through the night. Among those with the longest staying power this year were Elkin as well as Culture and Sports Minister Miri Regev, Tourism Minister Yariv Levin, Public Security Minister Gilad Erdan and Labor Minister Haim Katz.

The acknowledged champion isnt a cabinet minister or treasury official at all, but Zeev (Zambish) Hever, the revered elder of settler activists. This year he was ensconced in the Prime Ministers Office till the wee hours to ensure, among other things, 200 million shekels on infrastructure spending for the settlements.

The ministers stay to make sure that their pet projects stay intact amid all the shifts in spending that occur over the long slog of negotiations. Erdan, for instance, wanted a pay increase for police officers and got part of it. Ariel wanted approvals for more foreign guest workers for farmers and also claimed a partial victory.

They and their colleagues all claimed victories, but given that spending is due to rise 6% in 2019 from the current year, it wasnt hard for a minster to squeeze extra allocations out of the treasury. In any case, the numbers announced in press releases typically dont take into account the across-the-board cuts the treasury imposed.

The across-the-board cuts, which amount to 2 billion shekels this year and 2.9 billion in 2019, arent big victories for the treasury. The ministers prefer them because the pain is administered to everyone, but it leaves discretion about where to make the cuts to the ministries themselves, instead of to the treasury, and the result is often thoughtless spending reductions.

The fact the budget passed so smoothly is partly a function of tactics and party of circumstances. Kahlon made sure to have the prime minster on his side and could have won the cabinet vote with the just votes on Netanyahus Likud and his own Kulanu Party. But Kahlon also made sure to sew up support from Naftali Bennett, the education minister and Habayit Hayehudi leader, and Avigdor Lieberman, the defense minister and Yisrael Beitainu leader before the meeting.

But Kahlon was also helped by the fact that no one in the government wants early elections and was prepared to let the budget become an issue that could pull apart the coalition. In any case, the budget they approved doesnt go into effect for nearly another year. The people who approved the spending for each of the ministries may not be holding the same portfolios when the budget goes into effect.

Still, for all his success with the ministers, Kahlon still has to win the backing of the Knesset, and there the fight will be tougher. That is especially the case because the budget includes a law . that puts a cap on coalition financial transfers. The Knesset faction heads may have agreed to the law, but you can be certain there are many backbenchers who wont.

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