Finance Ministry and Defense Ministry Clash Over Funding for IDF Disabled Veterans Rehabilitation Reform
The dispute between Israel's Finance Ministry and Defense Ministry escalated this week over who will finance the rehabilitation reform for IDF disabled veterans. Finance Minister Bezalel Smotrich criticized the plan to fund the reform through a separate budget addition outside the Defense Ministry's multi-year 350 billion shekel strengthening program. In a letter to Prime Minister Benjamin Netanyahu and Defense Minister Israel Katz, Smotrich stated he would not accept that the defense buildup plan excludes wounded soldiers and omits implementing the Mor-Yosef Committee recommendations.
The core of the conflict is the budget source. The Finance Ministry demands that the approximately 2.5 billion shekels needed in the first year and 2 billion annually thereafter to implement the Mor-Yosef Committee's recommendations come from the Defense Ministry's existing budget, not from a dedicated extra allocation. Both the Defense Ministry and the IDF Disabled Veterans Organization strongly reject this stance. To prevent further escalation, Netanyahu announced that the government will vote next week to adopt the committee's recommendations after completing staff work, though the funding dispute remains unresolved.
The Mor-Yosef Committee, jointly appointed by the Finance and Defense Ministers, submitted its conclusions in early June, proposing significant expansions to the rehabilitation system. These include 920 million shekels for expanded rights and treatments, 346 million for completing the "One Soul" reform for PTSD victims, 200 million to strengthen the medical rehabilitation division, and 120 million annually for assigning a personal point of contact to each disabled veteran. A one-time 400 million shekel investment in technological infrastructure upgrades was also recommended.
The Defense Ministry emphasizes the urgency given the surge in wounded since the war began on October 7, with rehabilitation patients rising from 62,000 to 89,000, including 17,000 with mental or PTSD injuries, 30% with limb injuries, over 100 amputees, and more than 100 head injury cases. Defense officials accuse Smotrich of undermining a public expert committee he once called a "historic revolution" and unfairly blaming the ministry and wounded veterans.
The Disabled Veterans Organization intensified pressure with a campaign against Smotrich, urging him to take responsibility for war wounded rehabilitation. Chairman Idan Kleiman criticized Smotrich for endorsing the recommendations publicly but failing to fund them, warning of protests at the Finance Ministry and Prime Minister's office if the reform is not budgeted. The dispute reflects a broader power struggle between the Finance and Defense Ministries over state budget priorities, with the Finance Ministry viewing the defense budget as a negotiation starting point rather than a fixed framework.
While the Finance Ministry's position has some logic, viewing rehabilitation as separate from defense buildup, Smotrich argues that the strength of the IDF is measured by its people, making rehabilitation integral to military power. However, this broad definition could open the door to expanding defense budgets for other personnel costs. The public backlash has mainly targeted the Finance Ministry, as disabled veterans naturally associate rehabilitation with the Defense Ministry. The ongoing conflict highlights the difficulty in resolving budget disputes without public and political confrontation, leaving the wounded veterans caught in the middle as the main potential victims if no funding agreement is reached.
