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'2012 budget missing NIS 6.4B'
Bank of Israel says government missing large portion of budget needed to fund commitments made in 2011
The Bank of Israel predicted Tuesday that the Knesset will have to approve a series of additional government expenditures in 2012 in order to cover various agreements and reforms decided on in 2011.
According to the Bank of Israel, the government's planned expenditures for 2012 have now added NIS 9.1 billion ($2.43 billion), mostly due to an increase in the defense establishment's budget,
the implementation of the Trajtenberg Reform,
various wage agreements and the increase in minimum wage.
Government commitments to that effect amount to nearly NIS 6.4 (approx. $1.7 billion) and with no clear funding in sight, the Knesset would have to reshuffle the existing budget and possibly nix several pre-approved articles.
Economy
Avital Lahav, Reuters
International Monetary Fund urges Jerusalem to focus on cutting public debt; says downturn in 2012 unlikely
The government has already begun pursuing ways to fund its growing needs and reduce current expenditures, but despite an overall cut of NIS 2.7 billion ($721.6 million), there is still a $1.74 billion gap in the budget.
The central bank said that the government's initial way to meet its need would be to suspend all low-priority and under-performing projects.
Suspended projects' budgets are reverted to the Treasury, which can then reallocate them. The decision on where the money goes lies in the hands of the Knesset Finance Committee.
The Bank urged full transparency of the proceedings.
