Smotrich to bring wartime budget update for vote, unfreezing political earmarks

Finance minister heckled in plenum by opposition MKs who say government should not be spending on coalition favors as nation fights Hamas, deals with internally displaced masses

Carrie Keller-Lynn is a former political and legal correspondent for The Times of Israel

Finance Minister Bezalel Smotrich speaks during a Knesset plenum session, Jerusalem, December 3, 2023. (Yonatan Sindel/Flash90)
Finance Minister Bezalel Smotrich speaks during a Knesset plenum session, Jerusalem, December 3, 2023. (Yonatan Sindel/Flash90)

Finance Minister Bezalel Smotrich announced plans Sunday to bring a wartime budget update for a Knesset vote this week, triggering a shouting match with opposition lawmakers over earmarks that critics say will benefit narrow political interests at the expense of the rest of the nation.

The updated budget will retroactively account for NIS 30 billion ($8 billion) in wartime spending over the last six weeks. But its passage will also free up hundreds of millions of shekels meant to pay for various controversial initiatives Prime Minister Benjamin Netanyahu agreed to fund in exchange for the support of hard-right and ultra-Orthodox coalition allies.

Smotrich said Sunday he hoped to introduce the budget update on Monday, with the first of three necessary Knesset votes slated for Wednesday, adding that the plan was subject to change.

The cabinet approved the NIS 30 billion change to the last six weeks of 2023’s budget, redirecting funds toward fighting the ongoing war against Hamas and supporting the home front.

The comments came during a debate on a bill to decrease the deficit and limit expenses, as part of the budget update process. The measure later passed 59-53.

Shouts erupted across the plenum as opposition lawmakers heckled the finance minister for pushing ahead with plans to disburse funds to special interests favored by coalition parties, much of which will go toward funding ultra-Orthodox education that does not meet state criteria.

MKs respond to Finance Minister Bezalel Smotrich, during a Knesset plenum session, Jerusalem, December 3, 2023. (Yonatan Sindel/Flash90)

“You’re conducting politics on the backs of the evacuees,” yelled Yesh Atid MK Yorai Lahav-Herzano from the benches of the Knesset plenum, implying that Smotrich’s budget takes money that could have been used to support internally displaced people.

“Be embarrassed,” echoed Yesh Atid MK Meir Cohen, speaking from the Knesset podium, in comments directed toward Smotrich.

Smotrich accused them of engaging in “populism” against his funding decisions and trashing his wartime budget update because of prejudice against the ultra-Orthodox.

“I’m proud of my economic policy,” said Smotrich, accusing lawmakers of getting working up over “a few pennies here for the ultra-Orthodox.”

“You can’t get over a little bit of cynical hate for Haredim?” he continued. “You’re not embarrassed?”

Yesh Atid MK Meir Cohen speaks during a plenum session at the Knesset, Jerusalem, December 3, 2023. (Yonatan Sindel/Flash90)

In October, the cabinet froze all funds for discretionary political priorities that had not yet been transferred out of the Finance Ministry in order to reevaluate which resources could be diverted to the war effort. Of the NIS 2.5 billion ($674 million) in these so-called coalition funds still available for reallocation, Smotrich said he diverted some NIS 1.6 billion ($430 million) to the war effort.

The remaining 30% of coalition funds, which following approval can be transferred to various ministries and offices, include at least NIS 300 million ($81 million) for ultra-Orthodox education and reportedly also includes hundreds of millions of shekels to support settler priorities in the West Bank.

The NIS 30 billion updated budget does not address the 2024 budget, or the billions of shekels in coalition funds passed as part of it.

Smotrich also faced opposition from within the coalition, with Economy Minister Nir Barkat confirming that he would vote against the wartime budget update when it comes to the Knesset floor on Wednesday.

Barkat has publicly railed against the budget as being insufficient to answer wartime economic needs, and a source close to the economy minister says that the budget, as presented, “will lead to economic collapse.”

War cabinet minister Benny Gantz said in late November that his party’s five cabinet ministers would vote against the budgetary changes, though the budget is expected to pass even without their support or Barkat’s.

Opposition Leader Yair Lapid argued Sunday that Israel should not be making room for political funding promises during wartime.

“You can’t vote for billions of coalition funds during a war,” Lapid said from the Knesset rostrum. “I call on all coalition members who still have a piece of conscience in their heart to vote against this budget.”

Opposition Leader and head of the Yesh Atid party Yair Lapid speaks during a faction meeting at the Knesset in Jerusalem, on November 20, 2023. (Yonatan Sindel/Flash90)

Cohen pushed back against the idea that his opposition to the budget was driven by apathy toward the ultra-Orthodox.

“What fight do I have with the Haredim?” Cohen asked. “It’s legitimate for us to argue with you and say that in the middle of a war, we don’t need coalition funds.”

Smotrich left the plenum in the middle of Cohen’s remarks.

The Times of Israel staff contributed to this report.

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