Israel’s Ministries of Finance and Defence have clashed over the spiralling costs of Israel’s multiple and ongoing wars in the region, which are adding pressure to the government’s budget. The Israeli military has warned that if the dispute is unresolved it could jeopardise the security of the country. Since the war on Gaza began in October 2023, Israel has entered its longest period of sustained conflict in its history.
Israeli forces are deployed in Lebanon and Syria as they continue to occupy the Gaza and the West Bank, and are prepared for further conflict with Iran. Israeli military Chief of Staff Eyal Zamir warned that these costly conflicts are being undertaken with “empty coffers.” The Israeli government has attempted to inject a further 15 billion shekels ($5bn) into the military, the Israeli news website YNet reported, increasing the 2026 defence budget to 184 billion shekels ($60.8bn). The defence funding is a near-record in the country’s history, second only to the 188 billion shekels ($62.2bn) spent on defence during the first year of its genocide in Gaza.
Tensions between Israel’s defence and finance ministries have been building for some time, with the two sides divided over the scale and management of military spending. In late August, YNet News reported that the dispute was likely to continue even after the additional funding had been approved. Senior finance officials rejected the military’s claim that it was “on the edge of the abyss” and warned that meeting its demands could push military spending to nearly one-third of the country’s entire state budget, the Israeli media outlet added.
Their only mode of operation is using military force, as we’ve seen in Lebanon, Syria, Gaza and Iran, but they never seem to want to talk about paying for it,” Yossi Mekelberg, a senior consulting fellow at Chatham House, told Al Jazeera. The hardware, the ammunition, the soldiers, and the benefits if they’re injured,” he said. Politicians compete for small and often uncompromising parts of the electorate that are often unwilling or unable to see beyond their own interests.
That was especially true for Finance Minister Bezalel Smotrich, whose far-right Religious Zionist Party might not pass the electoral threshold to sit in the next Knesset. On the one hand, he needs the support of these hardcore nationalists who demand more expenditure on the military and their occupation of the West Bank. On the other, as minister of finance, he has to pay for it,” he said.
Briefings from within the Israeli military have blamed foot-dragging from the Finance Ministry for a number of potential spending cuts. This includes a sharp reduction in reserve forces in the Northern and Southern Commands, while the West Bank Division will be maintained at current levels despite heightened tensions and security warnings after a wave of settler pogroms against Palestinians in the occupied territory. The military has also warned that it will significantly scale back intelligence gathering, where operations rely on costly technologies.
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