Cabinet approves state budget for 2015-2016

The cabinet voted early Thursday morning to approve the proposed budget for 2015-2016, with 20 ministers in favor of the financial plan.

Ministers pulled an all-nighter to get the vote through despite ongoing disputes over the budget and Economy Minister Areyh Deri’s threat to vote against it if his demands that taxes be eased for lower-income households were not met.

Defense Minister Moshe Ya’alon was the only minister who abstained from the vote. There was a gap of some NIS 5 billion between defense officials’ demands and what Finance Minister Moshe Kahlon (Kulanu) was prepared to allocate.

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The defense budget will stand at NIS 57 billion for 2015 and NIS 55 billion for next year.

The overall budget for 2015 will stand at NIS 329.5 billion and will increase by NIS 13.8 billion for 2016. The deficit for 2015-2016 will stand at 2.9 percent.

Prime Minister Benjamin Netanyahu praised the approved plan, calling it “balanced, responsible and aimed at fostering growth.” He also hailed “coalition cohesion” and “government cohesion” in getting the plan passed.

Netanyahu’s words were echoed by Kahlon, who said: “The budget the government passed is balanced and responsible. Alongside the improvements to citizens in terms of living and housing costs, we are moving forward with big reforms, the likes of which have not been seen in many years.”

A slew of government ministries will get a budget increase, including the Education Ministry which will receive an additional NIS 4.9 billion, the Health Ministry which will get an added NIS 4.6 billion and the Ministry of Welfare and Social Services which will see a comparatively modest NIS 1.3 billion increase to its funds.

Among the reforms included in the budget and touted by the government are a series of plans to open up the food market to more competition, speed up development and planning processes for housing, lower fees related to financial services including pension funds, and a controversial natural gas reform.

The budget will now make its way to the Knesset floor.