What This Budget Bill is About
Israel’s Knesset has given the green light to the first reading of a proposal aimed at expanding the 2024 government budget by approximately NIS 3.4 billion. This budgetary boost is targeted towards vital expenditures, particularly related to recent war efforts.
Why It Matters
Speaking on the need for the budgetary adjustment, Finance Minister Bezalel Smotrich reassured that the increase would not inflate the state’s budget deficit by year-end. Thanks to higher-than-anticipated national tax revenues, the balance will be maintained. This strategic fiscal management emphasizes Israel’s robust economic stability even amidst national security investments.
The Targets for Increased Spending
Funds from this budget expansion will be directed towards several war-related allocations:
- Support for evacuees and recently released hostages and their families up to the end of 2024.
- Financial aid for businesses impacted by the war.
- Increased funding for combat reservists and their families.
Legislative Amendments Required
The successful passage of two legislative amendments is essential for this move. First, a change to the Deficit Reduction and Limitation of Budgetary Expense Law, which passed its initial plenum reading on Monday, and second, modifications to the 2024 Budget Law anticipated to pass later this week.
Political Dynamics and Support
The vote passed 58-50, buoyed by support from United Torah Judaism (UTJ) and Otzma Yehudit. Despite initial reservations, both groups backed the measure after reaching agreements on critical issues. Otzma Yehudit sought and obtained specific fund reappropriations linked to party leader MK Itamar Ben-Gvir’s role as National Security Minister. Meanwhile, UTJ pushed for solutions regarding the inclusion of its semi-private education system in salary agreements, reflecting collaborative coalition efforts.
Maintaining a Balanced Budget
Minister Smotrich pointed out that while Israel’s budget deficit reached 8.3% by the end of August as per recent reports, measures are in place to reduce this rate back down to a 6.6% limit by year’s end. This commitment underscores Israel’s effective economic governance and long-term financial sustainability.
Expert Insights
A source opposed to the measure acknowledged the specific, well-defined nature of the budget allocations, viewing it as an “appropriate solution” for urgent expenditures. Drawing parallels with how such budget mechanisms were effectively used during the COVID-19 pandemic, the source reasoned that sustained funding for reservists may necessitate distinct fiscal planning. However, the strength remains in Israel’s dynamic response to evolving national needs.
This story was first published on jpost.com.