Israeli Government Approves Controversial Funding Plan for IDF Wounded Rehabilitation Reform

The Israeli government has approved the recommendations of the Mor Yosef Committee for a comprehensive reform in the rehabilitation of IDF wounded soldiers and their families, following a sharp increase in casualties after the October 7 war. The committee, led by Professor Shlomo Mor Yosef, was established due to the exceptional burden on the rehabilitation department, which absorbed around 25,000 new war casualties, with over half suffering from mental health issues compared to 15% previously. The reform includes significant expansion of mental health treatments and increased rights for families of the wounded.

However, the funding method for this reform has sparked controversy and highlights Israel's complex budgetary reality. The government plans to finance the reform primarily through a broad 4% cut across all government ministries starting in 2027. This will affect various sectors, including the police, prison service, and Ministry of National Security, which are expected to lose about 500 million shekels, as well as culture, science, sports, and employment budgets.

In 2026, funding sources include 200 million shekels from coalition funds, 175 million shekels originally allocated for salary increases for teachers in ultra-Orthodox special education, and 39 million shekels redirected from the "Momentum" program budget for northern rehabilitation. For 2027, the government plans to cut 4% across ministries, reallocate 570 million shekels from the same teacher salary fund, and divert 100 million shekels from development budgets for eastern border authorities.

Critics note that while allocating funds for wounded soldiers is a worthy goal, the cuts to other public services reveal a strained fiscal environment. This decision coincides with the approval of 6 billion shekels in coalition funds in the 2026 budget and recent transfers of hundreds of millions of shekels to the Settlement Ministry and tens of millions to ultra-Orthodox kindergarten education, raising questions about budget priorities.

The government’s allocation totals approximately 415 million shekels in 2026 and about 1.34 billion shekels annually from 2027 onward, which is significantly less than the committee’s estimated need of around 2 billion shekels annually plus a one-time investment of about 500 million shekels mainly for IT upgrades. The discrepancy and reliance on budget cuts underscore ongoing challenges in fully implementing the reform.