Cabinet nixes vote to transfer NIS 300M to Haredi schools from wartime funds pool
Larger pool of coalition funds still unable to be redirected to war effort, as the Treasury has so far not initiated a request to pull them back into its general reserve
Carrie Keller-Lynn is a former political and legal correspondent for The Times of Israel
The cabinet nixed a scheduled vote on Sunday morning that would have transferred NIS 300 million to Haredi schools, out of a pool of frozen coalition funds that the government redirected to the war effort.
The planned vote was canceled after Minister Benny Gantz — who joined Prime Minister Benjamin Netanyahu’s national emergency government a week after the war broke out — opposed carving out the controversial transfer from a wartime freeze on funding political promises.
“The transfer of coalition funds for any purpose other than strengthening the residents of the south and the north,” whose border communities have been hardest hit by Hamas’s October 7 terror attack and the war it triggered, “bereaved families and the families of the abducted, alongside various other war efforts, is neither economically nor morally correct at this time,” read a statement issued early on Sunday by Gantz’s National Unity party.
“National Unity made it clear to the Likud that they would oppose the transfer of coalition funds for anything other than these purposes — both in the cabinet and in the Knesset, especially before all civil issues related to the war were attended to and budgeted,” the statement continued.
The NIS 300 million line item was poised to answer a critical political demand made by the government’s two ultra-Orthodox parties, meant to give their cash-strapped school systems a boost, without requiring them to adhere to full Education Ministry curricular guidelines.
It was frozen alongside a larger pot of coalition funds, so-called discretionary monies doled out by the government to fulfill political promises to its various constituent parties. That larger bundle, compromising leftover funds from 2023 and allocations for 2024, still has not been formally released back to the Treasury’s general reserve in line with the government’s October 29 cabinet decision 1006 (in Hebrew), which reallocated to the war effort any unused coalition funds and money from defunct government bodies.
Yesh Atid MK Vladimir Beliak, one of the opposition MKs on the Knesset’s Finance Committee, said that the total coalition fund pool is about NIS 7 to 8 billion from the two-year, 2023-2024 budget. He estimated that about NIS 1 to 1.5 billion are left from the 2023 funds.
Representatives from the Knesset Finance Committee and for Finance Minister Bezalel Smotrich were unable to verify the exact amount of frozen coalition funds. The Finance Ministry did not immediately answer a request for further information.
Beliak said that until the funds are transferred back to the general reserve, they cannot be used for other purposes, such as funding emergency lodging for the more than 100,000 Israelis required to be evacuated from their Gaza and northern border homes.
“The main problem right now, despite saying they’re stopping or freezing [funds], they’re not moving them into the reserve so that they could be used for war uses,” Beliak said, adding that “until they clear the money for other uses, it’s all just statements.”
In order to return the funds to a fungible pool, the Finance Committee has to ask the Knesset Finance Committee to return the already earmarked funds to the general reserve, and the Finance Committee then must approve the request. The matter can be resolved in about 48 hours, Beliak said, once initiated.
Shortly after the start of the war, Smotrich said he reopened the two-year, 2023-2024 budget in order to reprioritize money towards the war effort.
A representative for Smotrich said Sunday that “over NIS 5 billion have been transferred to [address] civilian war needs and soon all the changes required in the budget will be brought to the government and the Knesset as one legislative package.”
None of these funds included frozen coalition funds, confirmed a source close to the matter. Hebrew media has reported that another cross-ministry financial trim might be necessary to fund the war effort, following an earlier reduction made this spring to fund the Netanyahu government’s unusually heavy coalition fund burden, topping NIS 13.6 billion over two years.
The largest portion of these funds, NIS 3.9 billion over two years, was earmarked for Haredi education and yeshiva study. The NIS 300 million promise for Haredi private education schools in 2023 was twinned by a NIS 800 million funding promise for the same schools in 2024.
Opposition members have blamed Smotrich and Knesset Finance Committee chair MK Moshe Gafni for the hold up in clearing coalition unused funds for the war effort.
On Saturday night, Gafni released a rare message to say that the Finance Committee is not “delaying” budgetary transfers to the war, provided they have “reached” the committee.
“I am here to clarify the obvious over and over again — there is no delay in the budgetary transfers that reach the committee for combat needs. The opposite is correct,” Gafni wrote on X. “Any transfer that reaches the committee for supporting fighting at the front or on the home front will come up immediately.”
Transfer requests must be submitted to the committee by the Finance Ministry.
Gafni, a senior lawmaker for the ultra-Orthodox United Torah Judaism party, has long championed increasing allocations to the cash-starved Haredi school system.
“Apparently there’s a fight between the professional and political levels,” Beliak said of the hold-up, adding that “At the moment, everything is stuck because they still haven’t solved Haredi education.”
Ultra-Orthodox parties have narrow political demands, and funding community needs are chief among them. A second avenue exists to funnel money towards Haredi private schools, by passing a government decision, should the government ultimately opt to increase funding to the separate Haredi education during wartime.
