Finance Minister Israel Katz says he’ll bring forward a budget covering the rest of the year for government approval next week, despite the Blue and White party’s insistence it run through 2021.
“It’s impossible to continue in the present situation without a budget, and the last thing needed now is elections,” Katz, a member of Prime Minister Netanyahu’s Likud party, tells the Ynet news site.
While Likud and Blue and White agreed to pass a budget through 2021 as part of their coalition deal, the premier is now pushing for a budget that only covers the rest of the year, citing the uncertainty of the coronavirus pandemic. Doing so could allow him to call new elections without having to honor his power-sharing agreement with Blue and White leader Benny Gantz.
If no budget is passed by August 25, new elections will automatically be called.
Katz met earlier today with Gantz to discuss the budget, but the two failed to reach an agreement.
According to a Channel 12 news report this evening, a number of leading economists in Israel have warned in a letter against a short-term budget as advocated by Netanyahu, saying it “will only increase economic uncertainty” and confuse financial markets.
Among the economists who signed the letter were former Bank of Israel governor Jacob Frenkel and Menahem Yaari.
The Ynet news site meanwhile quotes unnamed Finance Ministry officials saying there’s no logic to passing a budget that only runs through December.