PM, Smotrich and Deri agree to cancel proposed stipends freeze in 2025 budget

Prime Minister Benjamin Netanyahu comes to an agreement with Finance Minister Bezalel Smotrich and MK Aryeh Deri to cancel a plan to freeze government allowances ahead of an expected vote on the new 2025 state budget.

As part of the agreement, benefits paid to the elderly, people with disabilities, Holocaust survivors, and families of fallen soldiers, will not be frozen as was proposed, apart from child allowances. Instead, National Insurance payments will increase by a corresponding amount, the PMO statement reads without providing further details.

“The decision was taken to uphold fiscal framework and the confidence of the markets, without harming the disabled, the elderly, bereaved families and weak population,” the statement reads.

Netanyahu’s cabinet convened on Thursday to discuss and approve the 2025 budget by ministers last night or by Friday morning, but it has not been voted on yet due to disagreements.

As part of the 2025 budget, the Finance Ministry proposes to significantly increase defense spending and calls for steep spending cuts and tax rises to finance the growing war costs and fill a fiscal hole of NIS 40 billion ($10.7 billion).