Cabinet slashes health, welfare and education to fund aid to displaced residents

Wide-ranging cuts come only days after Knesset allocates hundreds of millions of shekels in ‘surplus’ coalition funds to government ministries deemed superfluous by treasury

Sam Sokol is the Times of Israel's political correspondent. He was previously a reporter for the Jerusalem Post, Jewish Telegraphic Agency and Haaretz. He is the author of "Putin’s Hybrid War and the Jews"

Illustrative. Prime Minister Benjamin Netanyahu leads a special cabinet meeting at the Bible Lands Museum in Jerusalem on Jerusalem Day, June 5, 2024. (Yonatan Sindel/Flash90)
Illustrative. Prime Minister Benjamin Netanyahu leads a special cabinet meeting at the Bible Lands Museum in Jerusalem on Jerusalem Day, June 5, 2024. (Yonatan Sindel/Flash90)

Despite some ministers’ objections, the cabinet on Sunday approved a half-billion shekel ($135 million) budget cut across the government, in order to redirect funds toward aid for displaced residents of the north and south.

The sharp reduction in spending on healthcare, welfare, and other issues came less than a week after the Knesset Finance Committee allocated hundreds of millions of shekels in “surplus” coalition funds to government ministries — including several ministries deemed superfluous by the Finance Ministry.

Surplus funds are money allocated, but not spent, as part of the previous year’s budget, while coalition funds are monies doled out to fulfill political promises made when wrangling to form a coalition government.

The Prime Minister’s Office did not directly detail the new round of cuts in its post-meeting press release on Sunday, instead touting the extension of government aid to residents of southern communities within a range of 7 kilometers (4 miles) of the Gaza Strip and 5 kilometers (3 miles) from Lebanon.

“The government, today approved Prime Minister Benjamin Netanyahu’s proposal to extend the evacuation and respite for residents of southern communities located within 0-7 kilometers of the Gaza Strip border, and residents of northern communities located within 0-5 kilometers of the Lebanese border, until August 31, 2024,” the government announced.

“This is in light of the continued fighting and the operational and security significance stemming from an assessment of the situation, regarding the communities of the Western Negev and the communities of the north, except for those communities for which there is no security impediment to the return of their residents.”

An IDF serviceman stands outside a destroyed home in the Gaza border community of Kfar Aza on December 20, 2023. (Sam Sokol)

The PMO later clarified that the decision applies to residents of communities who are unable to return home due to security concerns and does not apply to residents of the Tekuma region near the border with Gaza, whose housing will be covered until August 15.

A spokesman for Netanyahu did not immediately respond to an inquiry regarding why the recently allocated coalition funds were not used for the displaced.

A spokesman for the opposition Yesh Atid party decried what he called “a reckless government that distributes funds to itself at the expense of the middle class, the reservists, and the taxpayers.”

Avigdor Liberman, the leader of the opposition Yisrael Beytenu party, likewise criticized the government for its allocation of resources, tweeting ahead of the cabinet vote that the government was set to cut “the health, welfare and education budgets for the benefit of the residents of the south and the north, but is jealously guarding the budgets of the unnecessary ministries for the sake of the integrity of the coalition.”

“The time has come for a different leadership,” he declared.

Yisrael Beytenu chairman Avigdor Liberman (right) and Yesh Atid leader Yair Lapid at the first government conference led by then-Israeli prime minister Naftali Bennett, at the Knesset on June 13, 2021. (Yonatan Sindel/ Flash90)

Per the government decision, all government ministries will have their budget slashed by 1.03%, prompting warnings from some ministers that vital services could be impacted.

According to a copy of the government decision posted on the government’s website, the cuts include NIS 7.7 million ($2 million) from the Finance Ministry, NIS 41,722,000 ($11.2 million) from the National Security Ministry, NIS 38,283,000 ($10.3 million) from the Education Ministry, NIS 27,532,000 ($7.4 million) from the Welfare Ministry and NIS 23,419,000 ($6.3 million) from the Health Ministry.

This is not the first time that such a cut has been implemented and “this time it may seriously harm precisely those citizens for whose sake the cuts are being sought,” Health Minister Uriel Busso declared ahead of Sunday’s cabinet meeting.

“In the war, it was proven that the Health Ministry is just as important as the Defense Ministry,” he said.

Busso’s criticism was echoed by the Israel Medical Association, whose head, Prof. Zion Hagay, wrote to Netanyahu on Sunday that for the government to cut the health budget would be to turn its back on both patients and medical personnel.

National Security Minister Itamar Ben Gvir speaks ahead of a faction meeting in the Knesset, March 18, 2024. (Sam Sokol/ Times of Israel)

“Just as it would be unthinkable to cut the defense budget during wartime, surely it would be unthinkable to cut a system that has been on the front line for nine months and is devotedly treating the wounded who are being evacuated from two fronts at the same time,” he wrote.

National Security Minister Itamar Ben Gvir also complained about the cuts on Sunday morning, arguing that they would negatively impact the procurement of equipment for police and civilian security squads, as well as hobble efforts to expand prison capacity strained by the ongoing war in Gaza.

The government has repeatedly allocated funds to Ben Gvir’s ministry in an attempt to add additional space for prisoners — most recently in April when a NIS 225 million ($60 million) budget cut intended to pay for expanding the prison system went into effect across the government at his insistence.

Beyond the money cut from ministries, the government reallocated NIS 525 million ($142 million) that had been designated for a collective agreement with Israeli teachers currently being negotiated.

According to Hebrew media reports, Netanyahu threatened not to approve ministers’ trips abroad if they opposed the cuts.

“Ministers who want to demonstrate are welcome to go outside and do so. Those who leave here by slamming the door will be taken into account in trips abroad and more,” The Marker quoted the prime minister as warning during Sunday’s cabinet meeting.

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