Israeli parliament approves two-year budget

Jul 15, 2009, 20:40 GMT

Jerusalem - Israel's 120-seat parliament, the Knesset, approved a two-year state budget late Wednesday, the first two-year spending plan in the country's history.

Fifty-eight lawmakers voted in favour and 36 voted against, while the remaining 26 either abstained or were not present.

The budget allows the Israeli government to spend up to 330.8 billion Israeli shekels (some 84.4 billion US dollars) in 2009, and up to 341.8 billion Israeli shekels (87.2 billion US dollars) in 2010.

Passing the budget has in the past proved a tricky task in Israel's complicated political system, where small parties enjoy relatively strong power to make or break governments which need them in their coalition.

Israeli Prime Minister Benjamin Netanyahu last week hailed the two-year budget - a bid to create greater economic and political stability in times of a global financial crisis - as one of his main achievements during his first 100 days in office.

'The passing of the two-year budget for 2009-2010, the first in the history of the State of Israel, and apparently also in the history of the entire Western world, is a festive day for the citizens of Israel, for all of us,' Finance Minister Yuval Steinitz of Netanyahu's ruling Likud party told the Knesset.

'Israel proved today, both the government and the Knesset, that it has courage, that it has freshness of thought, that it has economic leadership.'

But the opposition, led by the centrist Kadima party of former foreign minister Tzipi Livni, slammed the budget, which she charged was passed after Netanyahu 'caved in to pressures' and demands from various sides, and broke promises made during his election campaign.

'The prime minister is apparently counting on the short memory of the public and who at all remembers today that in Israeli politics promises should be kept?' she blasted.