Israel to Return to One-Year State Budgeting

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 Israel will abandon the two-year budget format initiated by the previous government and return to one-year planning for spending, Finance Minister Yair Lapid announced today.
The next budget will cover a 17-month transitional period from mid-2013 through 2014 after parliamentary elections delayed the current proposal, Lapid said in a statement today.
 Lapid, appointed finance minister three weeks ago after the Yesh Atid party he founded unexpectedly came in second in January’s election, must cut billions of shekels from government-promised funding to reduce the deficit to less than 3 percent of gross domestic product. The Bank of Israel is forecasting the deficit at 3.6 percent of GDP for this year.
“The considerable gap between two-year forecasts and actual government revenue led the economy to the deep overdraft that we are currently facing,” Lapid said. “Building a one- year work plan will narrow the margin of error between forecasts and actual revenue.”
Yael Andorn, a former deputy budget director, will serve as director general of the Finance Ministry, Nilly Richman, a spokeswoman for Lapid, said by telephone today. Andorn will be the ministry’s first female director general in the country’s 65-year history.
The two-year budget format was initiated for 2009 and 2010 by former Finance Minister Yuval Steinitz. Steinitz, who is currently serving as Minister of International Relations, said the two-year format was more efficient and allowed the government time to work on other issues besides spending allocations and taxes.