Prime Minister Benjamin Netanyahu is pushing for a single-year budget for 2020 instead of a two-year plan including 2021, a move testing the fragile unity government he formed with alternate-Prime Minister Benny Gantz, who favors a two-year budget.
Israel's government took office last month, with the delayed budget high on its agenda, after a third election in a year failed to lead to a decisive winner.
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As part of the deal to form a government that should see Gantz become prime minister after 18 months, the parties agreed to a dual-year budget to help maintain political stability. Passing a one-year budget would require reopening the pact.
Failure to pass a budget for 2021 by next March would automatically trigger new elections and Gantz would no longer become prime minister.
Polls show Netanyahu's Likud party would garner 40 of the Knesset's 120 seats, up from the current 36.
Netanyahu on Thursday met Finance Minister Israel Katz and other officials and said his pursuit of a single-year budget was not political.
"It is necessary to pass an immediate budget to meet current demands of the economy and the implications of the coronavirus and, upon receipt of the information on economic behavior and the pandemic in the winter, pass a second budget," Netanyahu said.
Katz also supports a single-year budget.
"A two-year budget that includes 2021 would require more aggressive measures," he told Channel 12, saying that passing just a 2020 budget would not be a reason to bring about the government's collapse.
Katz's spokesman said while there has been a recommendation for a single-year budget, no decision has been made. A final decision is expected by early next week.
In a conversation with Israel Hayom, Blue and White officials familiar with the details said: "We believe the right thing to do is make a budget for one year and a few months, rather than a budget for just a few months. With that, we've heard the positions of the Finance Ministry and other experts and we will weigh the matter based on professional considerations, not political considerations."
Opposition Leader Yair Lapid (Yesh Atid) tweeted, "Blue and White's demand for a two-year budget in a reality of the coronavirus pandemic is either amateurism or irresponsibility. There's no way to plan a budget two years ahead under conditions of such extreme economic uncertainty. This will clog the necessary help earmarked for the self-employed and unemployed, simply because of petty politics."
Communications Minister Yoaz Hendel (Derech Eretz), an ally of Gantz, asked in an interview on Army Radio about breaking the coalition agreement to pass a one-year budget, said he supports whatever will keep the government going.
"There are good arguments for a one-year budget and good arguments for a two-year budget," he said.
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"I don't think anyone has serious thoughts, especially in a period of economic crisis and the coronavirus, and possibly a second wave ... of going to another election," said Hendel.
Backed by the central bank, Israel has approved a 100 billion shekel ($29 billion) stimulus package to help the economy – which is headed for a contraction in 2020 – cope with the COVID-19 outbreak. The budget deficit is expected to reach 11% of gross domestic product.
