Israeli Parties’ Election Funding Raised 12% Despite Tens of Millions in Debt

The Committee for Party Financing decided last week to increase election funding for parties by 12%, raising the amount from 1.638 million shekels to 1.835 million shekels per Knesset member. This increase is expected to cost the state treasury an additional 27.5 million shekels, bringing the total estimated funding for parties to around 250 million shekels. The committee is chaired by Dr. Ron Shapira, with members including Prof. Mordechai Mironi and CPA Yitzhak Porer.

Each party currently in the Knesset is entitled to one funding unit per member, calculated as the average number of seats held in the outgoing 25th Knesset and the incoming 26th Knesset. Additionally, each list receives one extra funding unit of 1.835 million shekels. This system, established decades ago, protects parties expected to lose seats, such as Likud and Yesh Atid, from sharp funding declines. New parties like "Together" led by Naftali Bennett and "Straight to Israel" led by Gadi Inzkot will receive funding based on their elected members plus one additional unit.

Upon submitting candidate lists in early September, parties receive advance election funding proportional to their current Knesset seats, typically about one million shekels per member. New parties can receive advances up to 10 million shekels with a bank guarantee, refundable if they fail to pass the electoral threshold. Parties that secure at least 1% of valid votes but do not enter the Knesset receive one funding unit of 1.835 million shekels. Outstanding debts are covered by bank guarantees.

After the new Knesset convenes, parties can take loans repayable over 54 months to cover campaign expenses and debts. Repayments come from half of the monthly party funding, currently about 98,000 shekels per member. Each party also receives a fixed monthly payment of 98,000 shekels regardless of size. Joint lists like United Torah Judaism and the Arab parties receive separate fixed payments for each faction.

At the start of the current Knesset in late 2022, party debts totaled 208 million shekels. As of April, debts stood at approximately 40.9 million shekels, with Likud leading at 16.8 million shekels, followed by Yesh Atid (5.38 million), National Unity (3.3 million), and Ra’am (3 million). Other parties with significant debts include Yisrael Beiteinu, Labor, Degel HaTorah, and Agudat Yisrael. Smaller debts exist for Noam, Otzma Yehudit, and New Hope.

A February 2025 State Comptroller report warned of serious concerns about parties’ ability to repay loans on time, especially if parties dissolve after upcoming elections and lose state funding. Parties formerly led by Bennett, such as Yamina (17 million shekels debt) and the Jewish Home (3 million), still carry significant debts. Bennett’s new party does not automatically inherit these debts under current law.

In response, a legislative proposal dubbed the "Bennett Law," initiated by Likud MK Avichai Boaron, would require new parties to first use raised funds to repay debts of previous parties led by the same chairman before using funds for new activities. The law applies if the State Comptroller found mismanagement caused the debts. Although approved by the Ministerial Committee for Legislation, the proposal has not advanced further yet.