The coalition avoided a serious crisis on Tuesday by passing a law that was crucial for it to be able to pass the 2025 budget. The budget is one of a number of challenges that the coalition will need to deal with in the coming months.
First, according to law, the budget itself must pass before March 31, or else the government falls and an election is called. However, Finance Minister Bezalel Smotrich intends to have it pass by the end of January. As long as the budget does not pass, ministries will run on what is known as “continuous budget,” based on last year’s budget.Continuous budgets hamper the government’s capabilities as their spending is limited. The longer the legislation drags on, the larger the damage to the economy will be.
Another major challenge the coalition must surmount is the issue of haredi IDF service. Three haredi MKs broke with the coalition on Tuesday, with one opposing and two abstaining, and this trend will likely continue and even deepen until Netanyahu grants them an acceptable agreement.The MKs who broke with the coalition on Tuesday were from the hassidic Agudat Yisrael, but the other haredi parties, Degel Hatorah and Shas, have also demanded that a bill pass that exempts all Torah students from IDF service.
In an attempt likely intended to placate the haredi MKs ahead of Tuesday’s vote, Defense Minister Yisrael Katz revealed that his plan was to have 50% of each graduating haredi class enter nation service within seven years, and that haredim will receive necessary conditions to maintain their lifestyle while serving.The haredi parties will likely attempt to broaden this definition as much as possible to include volunteers in organizations like ZAKA and Magen David Adom, and thus avoid haredi integration into the military as much as possible.However, this plan may not enjoy a majority in the Knesset, as a number of coalition MKs have indicated that they will not enable the continuation of a mass haredi exemptions. The plan is for a gradual increase in the share of each graduating class until it reaches 50% in seven years, but not for 50% of all eligible haredi men to be in the IDF by then. This means that even if this goal is met, there will still be far less than 50% of all eligible military age haredi men actually serving by then.
Unlikely to receive backing of AG's Office
Even if the plan passes the coalition, it is highly unlikely to receive the backing of the Attorney General’s Office and faces a high chance of being ruled unconstitutionally unequal by the High Court of Justice. Since the previous haredi exemption officially expired at the end of June, the IDF has experienced very little success in recruiting haredim, despite thousands of draft orders being issued. However, barring a new bill, the IDF is now required by law to draft all eligible haredi men. Time is therefore not on the haredi parties’ side.Another factor is the expiration of daycare subsidies for thousands of haredi families at the end of February. As long as the exemption from service was legal, haredi families in which the mother worked and father studied in yeshiva received state-funded daycare for children under the age of three.This is a significant subsidy for young haredi families, many of whom have more than one child in that age range. However, since the exemption ended, yeshiva study for haredi men who are required to enlist can no longer serve as legal criteria to receive the subsidy.The High Court of Justice allowed for the subsidies to continue until the end of February in order to give the government and the haredi families time to adapt to the change, but is unlikely to enable another extension. This means that many haredi families will begin paying significantly more for daycare beginning in March. This sanction could push many haredi men towards IDF enlistment, and haredi politicians will likely demand a solution before then.A failure to broaden the pool of IDF soldiers will likely lead to extended reserve duty for the foreseeable future for active soldiers. Despite large benefit packages for reservists, the numbers of reservists who continue to answer summons is gradually decreasing, as a growing number are finding ways to back out of the grueling reality of IDF service and the distance from their families. This, too, could lead to a breaking point and cause a political crisis as well.Most importantly, the issue of a hostage deal and end to the war in Gaza will also likely continue to create tension. Netanyahu has refused to consider an end to the war in exchange for a comprehensive hostage deal, and prefers a partial deal that will return some hostages but enable the IDF to resume fighting after a temporary cease fire.However, both Smotrich and Otzma Yehudit chairman MK Itamar Ben-Gvir, who have 13 Knesset seats between them, are unlikely to support even a partial deal, and may leave the government if Netanyahu approves what they have deemed a “surrender agreement.”