Bethel Finance: 'Defense budget needs transparency, regulation'

www.bethefinance.com

Bethel Finance news:

Finance Minister Yuval Steinitz told the Foreign Affairs and Defense Committee (FADC) in Jerusalem Monday that he would like to see an increase in transparency and regulation for the defense budget.

According to Steinitz, the Defense Ministry should not have exclusive control over the defense bill, and that increased transparency would enable Israel to act "like a true democracy," according to Israel Radio.

The finance minister said that the Finance Ministry, and not the Defense Ministry, should be in charge of preparing the defense budget.

"The defense budget is part of the state budget – why is it separate?" Steinitz asked.

The finance minister said only two developments would justify an increase in defense spending: "A total war in the Middle East on the scale of the Yom Kippur War, not a war against terrorist organizations; or a severe economic crisis that will result in a decline in GDP per capita, in other words growth of less than 2%."

He made it clear that there is no reason to increase the defense budget, beyond the NIS 100 billion recommended by the Brodet committee over several years.

As for the Defense Ministry's demand for a bigger budget, Steinitz said, "If you increase the [defense] budget, it will breach the deficit framework, which will already be broken because of the partial decline in revenues.

"But it will also breach the spending framework, which the whole world will see. In addition, increasing the defense budget will compel tax hikes, which will harm the economy and burden the people," Steinitz said, adding "Increasing the defense budget will of course also come at the expense of the education and welfare budgets."

MK Amir Peretz (Labor) cautioned against transferring the responsibility of budgeting defense spending to the Finance Ministry, saying "you have to separate between wanting transparency, paralyzing ministries and undermining their authority to enact policy."

"We can be partners, but we have to make sure the Finance Ministry is not trying to take over and paralyze," Peretz said.

Labor MK Binyamin Ben-Eliezer supported Steinitz in that he believed the defense budget should be prepared with "maximum transparency."

He cautioned, however that the gamble of defense cuts may not be realistic for Israel.

"Nothing is for sure we don’t know where the wind is blowing in the Middle East," Ben-Eliezer said. "We cannot cut the budget it is a gamble."