Only 18 months ago, when the Bennett-Lapid government approved the 2022 budget, the then leader of the opposition Benjamin Netanyahu attacked the way coalition money was being dished out.
Netanyahu told the Knesset, "not only are Lapid, Bennett and Liberman not canceling the coalition money, they are doubling it. With this wasted money you are buying MKs' votes."
In the 18 months that have since passed, the leader of the opposition has become the prime minister, and Netanyahu now plans passing a budget at the end of the month in which coalition funds have not doubled but increased sevenfold to about NIS 20 billion.
The Ministry of Finance's Budget Division explains that the overall amount of coalition money won't reach NIS 20 billion but is not prepared to say what the correct amount is. The Budget Division insists there is no final proposal and only when the final version of the budget is submitted to the government, it will not be possible to talk about numbers. In this way the chaos behind the money to be divided up reigns and the politicians celebrate behind a smoke screen that conceals the amount from the public.
As if all this wasn't enough, in the coming days until the completion of the work by the Ministry of Finance on the final budget proposal for the government, coalition funds are only expected to grow, due to pressure from coalition members. Former senior Ministry of Finance officials testify that in previous years the situation was the opposite: after the agreement in the government on the framework of the coalition funds, the Budget Division worked to reduce the final proposal as much as possible. This time, the Budget Division failed to withstand the pressure, and probably did not receive the necessary backing for this purpose from Minister of Finance Bezalel Smotrich. Now, those examining current draft proposals against more preliminary drafts are discovering new sections such as additions to heritage sites and graves of the sages.
Budget Division is not proud
Officials in the Budget Division are not proud of the work done so far. While the Division's official presentations for the budget deal with the importance of increasing participation of haredi men in the job market, the funds they are transferring now will be used to encourage haredi men to stay in yeshiva and support educational institutions where math and English are not taught. Smotrich, by the way, claims that the budget includes tens of billions of shekels to encourage haredi men to participate in the job market, although it is difficult to find evidence of this.
At the end of February, the government approved the budget framework, in which NIS 12.5 billion was set for the distribution of coalition funds in the biennial 2023-24 budget - NIS 5.3 billion this year and NIS 7.2 billion more next year. Now the proposal, which will probably come up for discussion next week at the cabinet meeting, suggests, according to the data in the draft proposal, to increase this amount by an additional NIS 7.5 billion.
Unprecedented amount or average?
Smotrich said close to the cabinet's budget approval that the scope of the coalition funds in the budget is similar to the average of previous years. It is now clear that this is an unprecedented distribution of coalition funds in several different aspects: their total amount, breaching the original framework which was high in itself, and especially the purpose of the funds. Most of the funds will be transferred to ultra-Orthodox or religious sectoral purposes, while programs intended for the welfare of the entire public are conspicuous by their absence from the list.
So how does Smotrich claim that spending on coalition funds has not changed in the current government? It is possible that he is conducting an "expansive" calculation, which also includes items that were not defined as coalition funds, but as an integral part of the budget. To be sure, the definition of coalition funds is not absolute. Funds that are transferred as a result of a coalition agreement, but are channeled to the whole of society and not in a limited sectorial manner, can be labeled as "normal" non-coalition funds. Therefore, it is sometimes difficult to compare the actual amount of funds.
However, official figures do allow a certain comparison. According to the Budget Division, in previous Netanyahu governments the amounts were significantly lower. In 2015, coalition funds worth NIS 2.1 billion were allocated and in 2016 this increased to NIS 2.7 billion. Then came a ruling by then Attorney General Yehuda Weinstein that when approving a state budget, a full breakdown of the coalition funds would be required. In those years, it was thought that the directive would lead to a cut in coalition funds, since politicians would not want to reveal their sectoral demands. In 2017-2018, the amounts fell to NIS 1.5 billion and NIS 1.4 billion respectively (no new budget was passed from 2019 to 2021).
But then, with the establishment of the Bennett-Lapid government, the coalition funds returned to their original framework, with NIS 2.9 billion for the years 2021-2022. Now, these amounts just continue to grow, without control and it seems that there is also no fear of public criticism. Lapid, before he came to power, criticized the mechanism and promised to cancel coalition funds - something that was not done.
Victory for Orit Strook and the haredi parties
At the request of the haredi parties, the distribution of coalition funds in the upcoming budget will include an additional NIS 2.5 billion to support haredi yeshivas, NIS 125 million to support haredi Jewish culture, NIS 160 million to build religious buildings, an additional NIS 160 million for exempt institutions in ultra-Orthodox education, and many other budgets that will be transferred to the sector.
Other clauses in the draft of the distribution of coalition funds appeal to the Religious Zionism party public, which is headed by Smotrich. For example, the Ministry of National Missions, led by Orit Strook from Smotrich's party, will receive a large budgets including NIS 404 million for Jewish settlements, NIS 100 million for Jewish culture, NIS 60 million for Jewish identity and many other items.
The Otzma Yehudit party, led by Itamar Ben-Gvir, won't be short changed either. Ben-Gvir's Ministry of National Security will be allocated NIS 302 million in 2023 and NIS 880 million in 2024, "To promote a plan to strengthen national security," which will include, among other things, the expansion and strengthening of the Border Police and Israel Police.
Published by Globes, Israel business news - en.globes.co.il - on May 9, 2023.
© Copyright of Globes Publisher Itonut (1983) Ltd., 2023.