The government will be asked to approve today the distribution of NIS 1.3 billion in budgets promised to the coalition partners, chiefly Habayit Hayehudi and the haredi (ultra-Orthodox Jewish) parties, in the 2019 state budget. In addition to this sum, which was agreed on from the start, MK Moshe Gafni has succeeded in extracting a further NIS 100 million from the Ministry of Finance for haredi educational institutions and hospital construction.
The government will also be asked to approve a NIS 300 million across-the-board spending cut in the 2019 budget, and conditional across-the-board cuts that could amount to NIS 1.6 million if the Knesset Finance Committee fails to approve a series of proposals for increasing state revenues and reducing expenditure today in the budget bill.
Overnight, the Ministry of Finance sent a draft resolution to the government on distribution of the "coalition money", or the hundreds of millions of shekels that will be allocated to the haredi education networks and to the state religious education stream, to support for religious institutions and to activities meant to strengthen Judaism in Israel and the Diaspora.
These allocations, totaling NIS 1.266 billion, were promised to the coalition partners when the budget was approved in the government. The Ministry of Finance intended to cut it to NIS 750 million, but retracted in exchange for an undertaking from all the coalition party heads that they would not ask for more money over and above the agreed amount. Knesset Finance Committee chairman Moshe Gafni announced shortly after this undertaking was signed, however, that it did not bind him, and demonstrated his special status by obtaining NIS 100 million more from the Ministry of Finance: NIS 41 million for haredi education institutions an NIS 35 million for construction and equipment in hospitals.
The NIS 300 million across-the-board cut was made necessary by the changes introduced to the Economic Arrangements Bill that accompanies the state budget in the course of the discussions in the various Knesset committees. The consequence of these changes is a reduction in state revenues. The conditional cuts will become necessary in whole or in part to the extent that the Knesset Finance Committee fails to approve measures to increase the excise on coal (NIS 500 million) and cigarettes (NIS 120 million), taxation of diesel fuel and gas (NIS 120 million), and an indemnity from the National Insurance Institute (NIS 850 million).
Published by Globes [online], Israel business news - www.globes-online.com - on March 11, 2018
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