One of the central campaign promises of the governing coalition parties was to institute a universal draft to the IDF or civil service for Israel’s ultra-Orthodox and Arab populations, but that promise is in jeopardy due to austerity measures sought by those same parties.

At a Sunday meeting of the Peri Committee, tasked by the government with formulating a solution to the problem of the universal draft, a Finance Ministry representative told the committee members that under the current 2013-2014 budget draft there won’t be enough funding to implement wide-scale recruitment of the ultra-Orthodox and Arab populations into the IDF or civil service.

On Sunday, during marathon meetings, Finance Ministry and Defense Ministry officials agreed in principle to ease the planned cuts to the defense budget, but not at the expense of deeper cuts in other areas. According to Israel Radio, Prime Minister Benjamin Netanyahu decided to scale back proposed budget cuts to the Defense Ministry. The cabinet was due to convene Monday afternoon for further talks on the state budget.

The implementation of a true universal draft would require a wide budget outlay in several areas, including training and preparation for each recruit, regular payments for new IDF soldiers or civil service workers, and employment, educational programs and economic incentives aimed to entice the ultra-Orthodox community to enlist.

“The Finance Ministry doesn’t have the funding for this,” the Treasury’s representative told the committee, according to Maariv. “We expect very heavy cuts… I doubt if there will be an additional budget so that we can give incentives and rewards.”

The Peri Committee members were reportedly incensed at the Finance Ministry report. The Knesset and the Knesset Finance Committee are still to debate the proposed budget, which will be open to amendment.

Implementation of a universal draft was a central campaign promise of both Yesh Atid and the Jewish Home, who used their combined strength after the January elections to force Netanyahu’s Likud-Yisrael Beytenu faction to accept them into the ruling coalition, at the expense of the ultra-Orthodox parties, paving the way for new legislation on the draft.

As a result of coalition negotiations, however, Yesh Atid head Yair Lapid became finance minister, and is now presiding over austerity measures and budget cuts that are designed to manage Israel’s massive deficit, but would make implementing draft legislation financially challenging.

The Finance Ministry is looking to cut government spending by some NIS 6.5 billion (almost $2 billion) in 2013 and by NIS 18 billion (some $5 billion) in 2014, largely through the cuts in defense (NIS 4 billion or $1.12 billion), child benefits (NIS 2 billion or $560 million) and transportation infrastructure projects (NIS 1.2 billion or $336 million). Those measures are meant to slash a burgeoning national deficit that in 2012 reached NIS 39 billion ($11 billion), 4.2 percent of the gross domestic product.

The Finance Ministry’s budget proposal also raised value-added tax by one point (to 18%), increased income tax by 1.5% across the board, and boosted corporate tax to 26%, among a series of measures.

On Saturday night, thousands took to the streets in protest of the planned cuts, in what organizers hoped would mark a renewal of the 2011 social protest movement, which saw the largest public demonstrations in Israeli history.