Netanyahu Unilaterally Approves 40 Billion Shekel Boost to Defense Budget Amid Treasury Dispute

Prime Minister Benjamin Netanyahu has decided to increase the 2026 defense budget by 40 billion shekels, bypassing unresolved disagreements between the Ministry of Defense and the Treasury. The National Security Council distributed a budget summary confirming the phased addition, which will raise the defense budget to approximately 183 billion shekels, about 70 billion shekels above the original government agreement. The funds will be disbursed in three installments by the end of the year, with an immediate transfer of 15 billion shekels and two further payments of around 25 billion shekels each in October and November, aligned with military needs.

This decision follows warnings from the defense establishment that without the budget increase, operational capabilities would be compromised. The military highlighted risks including halted procurement of spare parts for tanks and other land platforms, suspension of construction for bases in sensitive areas such as the Gaza Strip and southern Lebanon, and potential shutdowns of ammunition production lines. These issues could force the release of reservists despite operational demands and limit future acquisitions from the United States.

The Treasury criticized the defense sector for exceeding its already substantial budget of 143 billion shekels by tens of billions, accusing it of poor financial management and resisting budgetary oversight. The government aims to fund the increase through revenue growth without opening a new budget for 2026. Additionally, the defense ministry will immediately be allowed to enter contracts worth 131 billion shekels to maintain ammunition and weapons production lines. The defense establishment pledged to reduce expenses where possible in 2026.

The budget dispute reflects ongoing tensions between the Treasury and defense officials over resource allocation amid heightened security demands and multiple operational fronts. Netanyahu’s unilateral move underscores the urgency attributed to maintaining military readiness despite fiscal disagreements.