Deadline for Israeli coalition government to approve budget delay

Today marked the deadline for Israel’s coalition government to agree on funds for the national budget.

The Blue and White–Likud coalition managed to iron out a deal on Thursday that adds $3.23 billion dollars to the provisional budget and allows the 100-day extension of the official budget negotiations to go into effect, giving the government time to begin formulating a 2021 proposal.

The Likud continue to lead opinion polls while a split within Blue and White, prompted by Alternative Prime Minister Benny Gantz’s decision to join Prime Minister Benjamin Netanyahu’s coalition, has severely diminished its standing in the polls. Expect negotiations to be contentious and, if a deal is reached, finish close to the extended deadline. Should no agreement be reached, new elections would be triggered.

New elections pose a risk to both parties. Netanyahu’s management of the COVID-19 pandemic and the start of his corruption trial in May are already generating massive protests against the government. The split of Gantz’s party practically guarantees that the Blue and White leader would fail to be part of the government, jeopardising Gantz’s assumption of the premiership next year, a role he is slotted to take per the current coalition power-sharing agreement. Gantz will likely make more concessions given his weaker position, especially regarding Likud’s preference for a one-year deal instead of the previously agreed two-year budget deal.

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