Cabinet to Cut New Budget to Pay for Emergency Services

Only one week after the Knesset passed the two-year state budget for 2011-2012, Prime Minister Benjamin Netanyahu and Finance Minister Yuval Steinitz want to make changes and cuts.

On Sunday, Netanyahu will present the cabinet with a proposal to add NIS 800 million to the budget for preparing for disasters and emergencies. But there would be a 1.5% across-the-board spending cut to pay for the emergency preparedness funding.

The cuts will affect all ministries and apply to both 2011 and 2012, though the education and defense budgets will suffer smaller cuts proportionately.

More cuts are expected soon because Netanyahu and Defense Minister Ehud Barak plan to increase the defense budget for 2011. Defense officials are demanding a NIS 5 billion increase. At the same time, the Finance Ministry says further budget cuts are needed to cover the salary increases promised to public-sector employees.

To offset some of these cuts, the 2010 budget ran a surplus of NIS 12 billion due to higher-than-expected tax intake.

The proposed budget cuts are for all ministries, though the proposal states that the cuts will not apply to spending required by law or contracts the state has already signed, including wage agreements.

The National Insurance Institute will also face a NIS 3.7 million cut in its administrative budget for the next two years.

Of the NIS 800 million, NIS 350 million will go for earthquake preparation and restoring firefighting capabilities to the Home Front Command. The money will be used for purposes such as establishing emergency centers in local authorities, building communications networks for emergency services, and buying equipment for the relocation of 400,000 people during emergencies.

Another NIS 350 million will be allocated to the civilian fire services and a new aerial fire service. The remaining NIS 100 million will be kept in reserve for use by the Prime Minister’s Office during emergencies.

The funding for the fire services comes with a number of conditions. The fire services will be transferred from the Interior Ministry to the Public Security Ministry, a move that will require legislation by the Knesset. The proposal will also require other reforms at the fire services.

The cabinet will also set up a committee for preparing the country for earthquakes, to be headed by Minister without Portfolio Benny Begin. The interministerial committee will receive NIS 15 million annually between 2011 and 2015.

According to the plan to be submitted Sunday, the defense budget will be cut by NIS 125 million and the Education Ministry budget will be cut NIS by 65.6 million, a 0.25% cut in 2011 and a 1% cut in 2012. The Public Security Ministry is facing a NIS 55 million cut over the two years.