Israel Government Collapse Looms After Budget Delay Rejected

(Bloomberg) -- Israeli Prime Minister Benjamin Netanyahu’s government appeared to be hours from collapse on Tuesday after parliament narrowly rejected a bill to defer a midnight deadline for approving the country’s budget.

If a spending plan isn’t passed by that cutoff, then the Knesset automatically dissolves and a fourth election in two years will be called with the country in the midst of a coronavirus-related health and economic crisis. By a vote of 49-47, lawmakers rejected putting off the deadline until Dec. 31.

An election, if called, must take place by March 23.

The budget crisis erupted after Netanyahu balked at honoring his coalition agreement to approve a two-year spending plan. A budget for this year alone would give him leeway to bring down the government over the 2021 blueprint, before Defense Minister Benny Gantz is to take over as premier next November under their power-sharing agreement.

Gantz came under stiff pressure from within his Blue and White party to make no further concessions to Netanyahu to keep their tense seven-month-old partnership alive. Among other things, Netanyahu sought to influence law-enforcement appointments as he prepares to take the stand in his corruption trial in February, Israeli media reported.

In an overnight session, several Blue and White lawmakers broke party discipline to vote against the deadline deferral on Tuesday and others didn’t show up for the vote. A Likud lawmaker who defected to the party recently formed by a Netanyahu rival also opposed it.

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