Israel cuts $840M from ministry budgets to fund defense procurement

Opposition lawmakers accused the government of protecting its political partners at the expense of public services.

By Pesach Benson, TPS

The Israeli government approved NIS 2.6 billion ($840 million) in across-the-board cuts to government ministry budgets on Sunday to finance urgent defense procurement, rejecting a Finance Ministry recommendation to cut political coalition allocations instead.

The decision imposes a 4.9% reduction on most ministries, sparing the Defense Ministry, which will receive the funds.

The cuts affect education, healthcare, welfare, transportation, and other public services, raising concerns about their impact as Israel approaches the end of the budget year.

The approval comes nine days before the October 27 election, with the government arguing that security needs cannot wait until a new administration is formed.

Education will lose NIS 285 million ($92 million), healthcare NIS 150 million ($48 million) and welfare NIS 140 million ($45 million).

The Ministry of National Security faces a NIS 225 million ($73 million) reduction, while transportation will lose approximately NIS 423 million ($137 million).

Other affected ministries include those responsible for the economy, agriculture, and energy.

The funding is intended for urgent, classified defense purchases. The government resolution did not detail the equipment involved or specify the security requirements behind the latest allocation.

The decision follows the government’s separate approval on Wednesday to transfer NIS 1.03 billion ($333 million) for defense procurement, including NIS 964 million ($312 million) taken from funding designated for a five-year plan to develop Arab communities between 2027 and 2029.

The remaining NIS 68 million ($22 million) came from the 2026 budget. The money is intended to advance a deal to purchase 12 Apache attack helicopters from the United States.

Together, the two allocations amount to approximately NIS 3.6 billion ($1.16 billion) for security procurement.

Finance Ministry legal adviser Dudi Kopel said there was no legal obstacle to approving the latest cuts but warned that the measure could have significant consequences for government services, particularly with less than three months remaining in the budget year.

He pointed to alternatives, including reallocating funds from government programs that have not yet been implemented.

The ministry’s professional staff recommended cutting coalition funds rather than reducing ministry budgets. That proposal was rejected by the government’s political leadership.

Opposition lawmakers accused the government of protecting its political partners at the expense of public services.

Yisrael Beiteinu faction chairman Oded Forer criticized the decision to leave coalition allocations untouched.

“Instead of cutting the coalition funds allocated to Aryeh Deri, Shas, United Torah Judaism and Orit Strock, they prefer to slash NIS 2.6 billion from government ministries across the board,” Forer said.

He added that the cuts would affect “the rehabilitation of northern Israel, healthcare, and welfare services in the periphery,” while he charged, funding for religious institutions and exemptions from military service remained protected.

Democrats lawmaker Gilad Kariv offered a blunt assessment, calling the coalition “a government of thieves.”

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