Following a public spillover of harsh exchanges from the coalition’s internal budget battle the day before, Prime Minister Binyamin Netanyahu and Finance Minister Yair Lapid were reportedly healing wounds on Monday.
“The gaps are shrinking in the main arguments between the prime minister and finance minister, and I believe that by the weekend or the beginning of next week they will come to an agreement,” the coalition’s coordinator in the Knesset Finance Committee, MK Gila Gamliel (Likud) told The Jerusalem Post.
An expanded defense budget and Lapid’s insistence on passing his flagship bill of 0% VAT on housing without raising taxes have been at the center of the dispute.
At the Prime Minister’s Office Monday, Netanyahu again emphasized the importance of defense, saying that any responsible leader would increase the defense budget in light of the many threats Israel faces, calling for a “significant increase of many billions.”
Nevertheless, a senior coalition source said the two are ready to compromise. A misunderstanding caused all the trouble, he explained. Netanyahu thought Lapid wanted to leave the coalition to either bring an election or to sit in the opposition, while the finance minister thought the prime minister wanted to oust his Yesh Atid party from the government and replace it with chareidi parties.
Gamliel, Knesset House Committee chairman Tzachi Hanegbi (Likud), Yesh Atid faction chairman Ofer Shelah and Lapid’s economic adviser Uri Shani were said to be the go-betweens.
The upshot is likely to be: more for defense, no new taxes, and an increased deficit.
“The minute [Netanyahu and Lapid] stopped suspecting each other, things became serious and not political,” the source stated. “They talked about the issues and Lapid said publicly that he doesn’t want elections, so they’re going back to normal.”
However, as of Monday night, uncertainty still prevailed. The source admitted that the next meeting hadn’t been scheduled yet, and there wasn’t even a budgetary outline, due to arguments and cancelled meetings.
Opposition leader Isaac Herzog (Labor) said Netanyahu and Lapid’s bickering over the budget is driven by ego and that the citizens of Israel, the middle class and the poor will lose out because of it.
“Labor will fight this budget, which will deepen social gaps. We are prepared for an election whether they’re tomorrow or in two years,” Herzog said.