PM said to tell Treasury to work on budget in case needed

Gantz said threatening new elections if Netanyahu tries to again delay budget

Blue and White chairman would allow Knesset to be dispersed in November, meaning early elections in February, as Likud ponders another deadline extension

Alternate Prime Minister and Minister of Defense Benny Gantz, and Prime Minister Benjamin Netanyahu, seen during a vote at the Knesset on August 24, 2020. (Oren Ben Hakoon/POOL)
Alternate Prime Minister and Minister of Defense Benny Gantz, and Prime Minister Benjamin Netanyahu, seen during a vote at the Knesset on August 24, 2020. (Oren Ben Hakoon/POOL)

Blue and White chairman Benny Gantz will not agree to a further delay in passing the state budget for 2021 and would act to disperse the Knesset and send Israel to another round of elections if Prime Minister Benjamin Netanyahu walks back his agreement to pass the budget by the end of the year, according to a Friday report.

The unsourced Channel 13 report did not give further details, saying only that it was in response to its report Thursday that Likud MK and Netanyahu ally Shlomo Karhi is planning to introduce legislation that would grant another extension to the deadline.

If the Knesset disperses in November, it would mean elections in February, the fourth round in two years.

The initial budget deadline had been in August, with a failure to pass the 2020-2021 budget by then requiring the Knesset to dissolve. But Likud and Blue and White agreed to a last-minute compromise that gave the parties 100 more days. That expires in November.

Israel has limped through 2020 with a state budget, and the coalition agreement provided for a two-year 2020-21 budget to be passed in the summer.

Likud MK Shlomo Karhi at a Knesset committee meeting on January 13, 2020. (Hadas Parush/Flash90)

Channel 13 noted that Karhi would not put his bill forward without approval from Netanyahu, who critics assert is bent on preventing Gantz from becoming prime minister in November 2021, as agreed upon in their coalition deal.

One of the few loopholes in that agreement that would prevent the Blue and White chairman from replacing Netanyahu after a year and a half would be if the parties failed to pass a budget, thus sparking early elections.

Netanyahu was reportedly considering a resort to elections at the end of the summer, but refrained from doing so while the country was still recovering from the pandemic and amid increased criticism of his leadership during the pandemic.

In the months since though, cases continued to rise, forcing the country into a second, unpopular lockdown. At the same time, recent polls indicate that the popularity and trust in Netanyahu’s right-wing rival, Yamina chairman Naftali Bennett, have sky-rocketed, while Netanyahu and Likud are slipping.

The troubling poll numbers evidently have Netanyahu preferring another deadline extension, rather than testing his chances by sending the country toward the fourth election in two years, and thus presumably emboldening Gantz.

Channel 13 further reported, on Friday evening, that Netanyahu has instructed Finance Minister Israel Katz to prepare a budget for 2021, and have it ready for approval by February, so that he can defuse the crisis if he wants to, and seek “not to be blamed” if Israel plunges into elections again.

The Knesset last passed a state budget in March 2018, which was in force until the end of 2019. The lack of a comprehensive budget law in 2020 has left many ministries struggling with unexpected budget shortfalls and made it difficult to plan ahead. Many organizations, including those that ran the largest programs for at-risk youth in the country, were forced to close for part of the year as government support dried up. Some treasury officials have warned that Israel’s credit rating with international lending agencies could be hurt.

Under the coalition deal between Likud and Blue and White, Netanyahu can retain the premiership in an interim government only if the government falls due to failure to pass a budget, a move that the prime minister has been accused of engineering.

The Blue and White party wants the 2020-2021 budget passed by December to prevent Netanyahu from having the option of heading to elections early next year. On its side is the coalition agreement, which stipulated that a two-year budget would be passed this year.

Yamina leader Naftali Bennett speaks during a Knesset plenary session at the Knesset, August 24, 2020. (Oren Ben Hakoon/ POOL)

Polls have shown Blue and White sinking to 8-10 seats, if elections were held now. Likud has also seen its prospects wither, with a poll from the channel last week showing it dropping to 26 seats, just three more than the right-wing nationalist Yamina party.

Earlier this week, Blue and White minister Izhar Shay warned that should Netanyahu break for fresh elections in the coming months, the party will ensure that he steps down from office in the interim period and will work to prevent his reelection.

While Shay did not expound on how his party might do this, the Kan state broadcaster quoted an unnamed Blue and White source saying that party members were in talks with Likud lawmakers over the possibility of setting up an alternative government should the current one fall.

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