In key test for new government, cabinet to meet to approve 2021-2022 budget

Israel has been without a budget since 2019; health minister threatens to oppose; Ra’am leader will reportedly be on hand for negotiations

Prime Minister Naftali Bennett chairs the weekly cabinet meeting in Jerusalem, June 27, 2021. (AP Photo/Maya Alleruzzo, Pool)
Prime Minister Naftali Bennett chairs the weekly cabinet meeting in Jerusalem, June 27, 2021. (AP Photo/Maya Alleruzzo, Pool)

The cabinet was set to convene on Sunday morning to approve the state budget — the first since 2019 — in a major test for the new government.

The 2021-2022 budget ($187 billion for 2021, $173 billion for 2022) will be advanced by Finance Minister Avigdor Liberman, though it faces significant hurdles in the Knesset before a November deadline for passage.

The budget will require all the votes of the wafer-thin coalition to pass, with the opposition of a single lawmaker able to bring it down. The diverse composition of the new government led by Prime Minister Naftali Bennett — it is made up of right-wing, centrist and left-wing parties — complicates the effort.

Ahead of the cabinet meeting, Health Minister Nitzan Horowitz of the Meretz party reiterated his threat to oppose the budget if healthcare funding is not increased.

“This is a right-wing government. We are heading for a [political] crisis. Under these circumstances there is no reason for us to stay [in the government],” threatened the left-wing Horowitz ahead of the meeting.

The new state budget includes sweeping reforms of the kashrut establishment and the agriculture industry, steep taxes on disposable plasticware and sugary drinks, and considerable changes to import policies.

Health Minister Nitzan Horowitz speaks during his visit to the Beilinson Medical Center, on July 27, 2021. (Avshalom Sassoni/Flash90)

Farmers are planning a protest Sunday outside the Knesset over proposed agriculture reforms in the budget.

The new budget will also raise the defense budget for 2022 to NIS 58 billion ($17.8 billion), according to a government statement last week. That will include a substantial increase — some NIS 7 billion ($2.15 billion), according to the Kan public broadcaster — for “rearmament and strengthening the Israel Defense Forces” to prepare the military for a potential strike on Iran, according to the statement from the prime minister, defense minister, and finance minister.

Though he is not a minister, the head of the coalition’s Ra’am party, Mansour Abbas, will be on hand for the cabinet’s budget talks, the Kan public broadcaster reported. Sources in the government will also be talking to members of the opposition’s Joint List to negotiate support from outside the coalition for the state budget, the report said.

Foreign Minister Yair Lapid (L) speaks with MK Mansour Abbas, head of the Islamist Ra’am party, in the Knesset plenum on June 21, 2021. (Olivier Fitoussi/Flash90)

Four out of the six Joint List MKs were said to be planning to oppose the budget.

Israel’s last approved state budget was for 2019, before the country became embroiled in a two-year political gridlock. In the previous government, then-prime minister Benjamin Netanyahu refused to pass a budget — which allowed him to call elections without coalition partner Defense Minister Benny Gantz immediately becoming transitional prime minister under the terms of their rotation deal.

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