Israel woke up on Wednesday morning with a message from Finance Minister Bezalel Smotrich:

“There is a budget!
Good morning citizens of Israel,
Good morning to the State of Israel,
Good morning to the government of Israel.
Good morning Knesset of Israel.
We received the tools, we’re rolling up our sleeves and we’re continuing to work for the citizens of Israel.”


Despite the last-minute dramas between and inside the various coalition parties, and a boisterous opposition yelling “Busha” (shame) at times during the vote, the Knesset approved in its second and third readings the state budget and economic plan for 2023-2024. The budget passed 64-55 with 530 item votes and zero losses to the coalition. Knesset Speaker Amir Ohana, as reporter Amit Segal pointed out, ran the entire 10-hour Knesset marathon vote session entirely by himself.

The state budget for 2023 will be about 484 billion shekels and in 2024 about 514 billion shekels. The Ministry of Education’s budget will be approximately NIS 77 billion and NIS 82 billion, respectively, the defense budget will be approximately NIS 63 billion and NIS 64 billion, and the Health Ministry’s budget will be approximately NIS 44 billion in 2023 and NIS 50 billion in 2024. Also, The Arrangements Law was approved, which includes steps to accelerate growth and raise the standard of living and focuses on five main goals:

  • accelerating infrastructure and handling the housing market,
  • increasing competition and reducing centralization,
  • strengthening human capital,
  • reducing regulation and bureaucracy for the business and citizen sectors,
  • and streamlining the public sector.

Minister of Finance, Bezalel Smotrich said [translated]:

“The state budget for the years 2023-2024 is an excellent state budget. It is biased towards growth, infrastructure, encouraging capital investments in high-tech, in agriculture, a huge investment in the health care system that has been neglected for years, a huge investment in governance and the security system, a huge investment in higher education and in the education system on all levels.

The Israeli economy is a strong economy. Our economy is one of the best and most stable economies in the world. When there were economic storms in the past, we were the first to get out of them. This is also what will happen now and a lot tof hanks to the budget and the Arrangements Law (Chok Hahesderim) that we have now approved.

When we formulated the budget, we had one main goal in front of our eyes – continued growth. Israel’s macro data is one of the best we have known and I insist on continuing to preserve these good data.

The Arrangements Law contains significant and essential reforms that are critical to the fight against the cost of living and to streamlining and upgrading the standard of living in Israel. The property tax fund that will finally bring about the correction of a long-standing distortion and will incentivize the heads of authorities to prioritize the construction of residential housing units – a move that will certainly bring down the cost of housing. The National Infrastructures Law, which is also in the Settlements Law, will shorten processes and dramatically improve the construction of national infrastructures and projects. The broiler reform that will bring about a significant reduction in poultry prices. The import reform that will lead to a significant reduction in meat prices. The plant protection law that will bring about a significant discount on fruits and vegetables and will help farmers continue to develop. The credit law, the banking law, the pharmacists’ ordinance, the eviction law, the war on black market capital, and other significant laws and reforms that were avoided for years and with the Arrangements law approved today – they entered the law book of the State of Israel for the sake of all of us.

Citizens of Israel, the budget and the settlement law approved today are great news for Israel’s economy, for the Israeli economy and for all of us. We will continue to fight the cost of living and with the best budget approved today, the job will be done more accurately and correctly.

I thank Prime Minister Benjamin Netanyahu and my coalition partners for working together for the benefit of the citizens of Israel. The approval of the budget reflects the stability of the government. We will continue to work for you.”

While this government has had some important successes since being elected, it’s mostly been marred by the organized anarchist protests against it and its failure to pass the judicial reform bills. Passing the budget is actually the most major policy success it’s had since being voted in and perhaps might be the turning point for this government needed to finally coalesce and start working properly.

Prime Minister Netanyahu said, amusingly recycling someone else’s phrase, “This is the dawn of a new day” and a good day for the state of Israel. He added that the judicial reform will pass, and they will try to reach understandings with the opposition. Netanyahu added that the vote ended 12 hours earlier than he expected which means to him that this coalition knows how to work properly and will last four years.



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