War Cabinet minister Benny Gantz warned Sunday that failure to divert all coalition discretionary funds to war needs would cause his National Unity party to vote against a proposed war budget and could lead it to “consider its next steps,” hinting he could bolt the government.
Prime Minister Benjamin Netanyahu’s office indicated it would not accept Gantz’s demands, saying the proposal will be brought before the cabinet Monday and “answers the needs of the war.”
The cabinet was set to discuss changes to the 2023 state budget due to the needs of the conflict with Hamas in Gaza, with Finance Minister Bezalel Smotrich insisting on keeping hundreds of millions of shekels in discretionary coalition money directed at their pre-war targets.
The war budget will be financed by increasing the deficit, channeling funds from government ministries, and cutting some discretionary coalition money, the Treasury said earlier this month.
But Smotrich has kept in the budget some NIS 900 million ($240 million) in funds promised to parties under coalition deals for their preferred goals, including over NIS 300 million for settlement development and “Jewish identity projects” under Settlements and National Missions Minister Orit Strock, as well as over NIS 200 million for Haredi educational and cultural projects.
In a letter to Netanyahu, Gantz said earmarking large sums to controversial needs that do not pertain to the war “will harm national resilience and Israeli societal unity.”
“At this time, all of Israeli society must share the load. The public knows this, and the government must act accordingly,” he said.
Gantz, who was a vocal opponent of the current government since its founding and only entered it temporarily last month to help steer the war after Hamas’s devastating attack on Israel, stressed that “any available moneys must go to war needs and to them alone. If the session is held and the budget stands, National Unity will vote against the proposed budget and will consider its next steps.”
The Prime Minister’s Office insisted that “We will present tomorrow an unprecedented budget of NIS 30 billion ($8 billion) for 90 days that fulfills the needs of the war. The budget will fully provide for the needs of the IDF, both offensively and defensively, will care for the families of the hostages, the wounded, the fallen and the murdered and the evacuated families — and will promise that Israel’s economy continues to work and thrive.”
Prime Minister Benjamin Netanyahu speaks at a press conference at the Defense Ministry headquarters in Tel Aviv, November 22, 2023. (Chaim Goldberg/Flash90)
It added that “over 70% of discretionary funds, at NIS 1.6 million ($420 million), have already been cut.”
The government has come under intense criticism since October 7 for its failure to provide adequate financial support to those affected by the war, including the hundreds of thousands evacuated from their homes and the many whose livelihood has been harmed.
Smotrich has insisted that the new budget diverts enough funds for such needs and has called the nearly NIS 1 billion in political spending “petty cash” when compared to the larger budget.
The Bank of Israel has disagreed, warning earlier this month that the Treasury’s proposed cuts were not enough and that the government needed to free up additional non-war-related spending, including discretionary coalition funds, to tackle the costs of the ongoing fighting.
Bank of Israel Governor Amir Yaron attends an Interior Committee meeting at the Knesset, on July 19, 2023. (Yonatan Sindel/Flash90)
In addition to the Finance Ministry’s plan to shave about NIS 4 billion ($1.06 billion) from the 2023 state budget to fund war expenses, there is room to cut another NIS 8 billion to NIS 10 billion in non-war expenditure from next year’s state budget, including planned coalition fund payments, according to a review by the central bank.
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The scope of the budget cut currently proposed is not “large, and as such its contribution to strengthening the credibility of the government’s commitment to fiscal adjustment for the costs of the war is limited,” the central bank said in its review.
The central bank was indirectly raising concern that the government’s new fiscal plan could harm its standing in international markets and negatively impact future decisions by credit rating agencies, which in turn could lead to higher costs for raising debt by the State of Israel.
The 2023-2024 state budget, passed in May, included almost NIS 14 billion in discretionary spending, much of which is allocated to educational programs for the ultra-Orthodox community.
To finance the costs of the war with the Iran-backed group, which broke out after the October 7 atrocities perpetrated by Hamas, the Finance Ministry is proposing amendments for an increase in the 2023 budget of about NIS 31 billion — NIS 22 billion for defense spending and NIS 9 billion for civil expenses — alongside a cut of NIS 4 billion in other expenses.
The Bank of Israel emphasized that it estimates that the total fiscal cost of the war in 2023 will not amount to just the NIS 35 billion currently presented by the Finance Ministry. Additional war expenditure will likely be required later in the year or in 2024, and the government will have to finance them from its budget.
Looking ahead to the aftermath of the war, the central bank noted that government expenditure is likely to become bigger due to a permanent increase in defense spending and interest payments as the level and cost of its public debt rises.
Sharon Wrobel and Carrie Keller-Lynn contributed to this report.
Simon Jolin-Barrette, minister responsible for consumer protection, has tabled a bill to force merchants to calculate tips based on the price before tax.
That means on a restaurant bill of $100, suggested tips would be calculated based on $100, not on $114.98 after provincial and federal sales taxes are added.
The bill would also increase the rebate offered to consumers when the price of an item at the cash register is higher than the shelf price, to $15 from $10.
And it would force grocery stores offering a discounted price for several items to clearly list the unit price as well.
Businesses would also have to indicate whether taxes will be added to the price of food products.
This report by The Canadian Press was first published Sept. 12, 2024.
Quebec legislature member Youri Chassin has announced he’s leaving the Coalition Avenir Québec government to sit as an Independent.
He announced the decision shortly after writing an open letter criticizing Premier François Legault’s government for abandoning its principles of smaller government.
In the letter published in Le Journal de Montréal and Le Journal de Québec, Chassin accused the party of falling back on what he called the old formula of throwing money at problems instead of looking to do things differently.
Chassin says public services are more fragile than ever, despite rising spending that pushed the province to a record $11-billion deficit projected in the last budget.
He is the second CAQ member to leave the party in a little more than one week, after economy and energy minister Pierre Fitzgibbon announced Sept. 4 he would leave because he lost motivation to do his job.
Chassin says he has no intention of joining another party and will instead sit as an Independent until the end of his term.
He has represented the Saint-Jérôme riding since the CAQ rose to power in 2018, but has not served in cabinet.
This report by The Canadian Press was first published Sept. 12, 2024.
MONTREAL – NDP Leader Jagmeet Singh says he will not be taking advice from Pierre Poilievre after the Conservative leader challenged him to bring down government.
“I say directly to Pierre Poilievre: I’m not going to listen to you,” said Singh on Wednesday, accusing Poilievre of wanting to take away dental-care coverage from Canadians, among other things.
“I’m not going to listen to your advice. You want to destroy people’s lives, I want to build up a brighter future.”
Earlier in the day, Poilievre challenged Singh to commit to voting non-confidence in the government, saying his party will force a vote in the House of Commons “at the earliest possibly opportunity.”
“I’m asking Jagmeet Singh and the NDP to commit unequivocally before Monday’s byelections: will they vote non-confidence to bring down the costly coalition and trigger a carbon tax election, or will Jagmeet Singh sell out Canadians again?” Poilievre said.
“It’s put up or shut up time for the NDP.”
While Singh rejected the idea he would ever listen to Poilievre, he did not say how the NDP would vote on a non-confidence motion.
“I’ve said on any vote, we’re going to look at the vote and we’ll make our decision. I’m not going to say our decision ahead of time,” he said.
Singh’s top adviser said on Tuesday the NDP leader is not particularly eager to trigger an election, even as the Conservatives challenge him to do just that.
Anne McGrath, Singh’s principal secretary, says there will be more volatility in Parliament and the odds of an early election have risen.
“I don’t think he is anxious to launch one, or chomping at the bit to have one, but it can happen,” she said in an interview.
New Democrat MPs are in a second day of meetings in Montreal as they nail down a plan for how to navigate the minority Parliament this fall.
The caucus retreat comes one week after Singh announced the party has left the supply-and-confidence agreement with the governing Liberals.
It’s also taking place in the very city where New Democrats are hoping to pick up a seat on Monday, when voters go to the polls in Montreal’s LaSalle—Émard—Verdun. A second byelection is being held that day in the Winnipeg riding of Elmwood—Transcona, where the NDP is hoping to hold onto a seat the Conservatives are also vying for.
While New Democrats are seeking to distance themselves from the Liberals, they don’t appear ready to trigger a general election.
Singh signalled on Tuesday that he will have more to say Wednesday about the party’s strategy for the upcoming sitting.
He is hoping to convince Canadians that his party can defeat the federal Conservatives, who have been riding high in the polls over the last year.
Singh has attacked Poilievre as someone who would bring back Harper-style cuts to programs that Canadians rely on, including the national dental-care program that was part of the supply-and-confidence agreement.
The Canadian Press has asked Poilievre’s office whether the Conservative leader intends to keep the program in place, if he forms government after the next election.
With the return of Parliament just days away, the NDP is also keeping in mind how other parties will look to capitalize on the new makeup of the House of Commons.
The Bloc Québécois has already indicated that it’s written up a list of demands for the Liberals in exchange for support on votes.
The next federal election must take place by October 2025 at the latest.
This report by The Canadian Press was first published Sept. 11, 2024.
