Israeli Government's 37th Term: Billions Allocated to 'Jewish Identity' and Coalition Partners

The 37th Israeli government established and expanded several small ministries, primarily to provide portfolios and budgets to coalition partners. Coalition agreements allocated approximately 1.3 billion shekels to promote "Jewish identity" among secular and traditional Israelis. The Ministry of Settlement and National Missions saw its budget increase fivefold within seven months, and the government funded illegal outposts. The Minister of Religious Services advanced legislation that could triple the number of state-funded rabbis, while the Minister of Heritage was suspended from government meetings following remarks about a nuclear bomb on Gaza. Concurrently, the Ministry for the Development of the Negev and Galilee utilized only a fraction of its budget for the Bedouin community.

Coalition agreements designated about 1.315 billion shekels for advancing Jewish identity, distributed among various ministries. The Ministry of Jerusalem Affairs and Tradition received 500 million shekels, the Ministry of Settlement received 270 million for cultural programs, the Ministry of Heritage received 200 million, and the Authority for Jewish Identity received 185 million. This funding was directed towards an area previously lacking a defined budget, even as the government raised VAT and cut welfare budgets.

The budget for the Ministry of Settlement and National Missions, headed by Orit Strock, grew from 133 million shekels in May 2023 to 653 million by the end of the year. Seventy-five million shekels of this increase were for security components in Judea and Samaria settlements. The ministry also received an additional 200 million shekels in 2024 from coalition funds. Some of these funds were directed to outposts deemed illegal under Israeli law, with reports indicating government funding through eight different channels, including 28 million shekels from the Settlement Division in 2023. The United States, Canada, and the European Union have imposed sanctions on settlers and organizations involved in funding these outposts.

Minister of Religious Services Michael Malchieli advanced the "Rabbi Law," which could potentially increase the number of state-funded rabbis from 491 to 1,572, at an estimated annual cost of 100 to 120 million shekels. The law mandates the appointment of city rabbis in 33 municipalities lacking one and introduces neighborhood rabbis for the first time in two decades. Following Shas's departure from the government in July 2025, the ministry transferred to Justice Minister Yariv Levin.

Minister of Heritage Amichai Eliyahu was suspended by Prime Minister Benjamin Netanyahu from government meetings in November 2023 after suggesting a nuclear bomb on Gaza was "one way." Despite this suspension, Eliyahu continued in his role, and the ministry's budget increased by 40% to 74 million shekels, with an additional 200 million allocated for Jewish identity initiatives.

The Ministry for the Development of the Negev and Galilee, led by Yitzhak Wasserlauf, failed to utilize most of its budget allocated for the Bedouin community, spending only about 17 million shekels out of 120 million over two years. Similarly, the Ministry of Interior utilized only 2.9 million shekels of a 252 million shekel budget. The State Comptroller also reported government failures in rehabilitating northern communities following the conflict, with the Prime Minister's Office bearing primary responsibility.