Israeli Finance Ministry Warns Torah Study Basic Law Could Harm Economy and Security

The Israeli Finance Ministry issued a critical legal opinion warning that the proposed Basic Law on Torah Study could have far-reaching economic, security, and budgetary consequences. The ministry cautioned that if the law grants constitutional priority to Torah study over the principle of equality, it might justify expanding benefits and budgets for Torah students, including housing, daycare, public transportation, and educational institutions. Such changes could disrupt budget priorities and complicate enforcement of military conscription for yeshiva students.

The ministry highlighted that since the outbreak of war, the Israel Defense Forces (IDF) have had to significantly expand reserve service, requiring approximately 12,000 additional conscripted soldiers. The economic cost of one month of reserve duty for a single soldier averages about 50,000 shekels, with total reserve service costs projected at around 170 billion shekels for the economy and 115 billion shekels for the state budget between 2023 and 2026. Any reduction in conscription incentives for ultra-Orthodox men could increase the burden on reservists and the economy.

Data cited in the opinion indicates that economic sanctions following Supreme Court rulings have already increased ultra-Orthodox enlistment rates, with an estimated 3,500 recruits in 2025, a 50% rise from 2024 and more than double pre-war levels. The ministry warns that removing these incentives or restoring benefits could halt this positive trend.

The opinion also addresses long-term labor market impacts, noting that ultra-Orthodox male employment remains low at about 53%. Given projections that the ultra-Orthodox population will constitute roughly one-third of Israel’s population by 2065, this could harm economic growth, reduce tax revenues, and necessitate tax hikes to maintain public services.

In conclusion, the Finance Ministry states that if the Basic Law prioritizes Torah study over other constitutional values, it risks undermining the state's ability to increase IDF recruitment, burdening reservists, weakening labor market integration, and deepening economic challenges in the coming years.