The Israeli economic newspaper “Calcalist” revealed that the draft Israeli state budget for 2025 includes camouflage financial techniques aimed at allocating billions of shekels to religious education institutions, despite what appears on the surface to be reductions in their budgets.
While the country faces major economic challenges due to the war, these institutions continue to be funded through the coalition funds mechanism to avoid public criticism, according to the newspaper.
On Sunday, Parliament is expected to hold an initial vote on the 2025 budget, which was delayed due to the war in Gaza and Lebanon.
Conflicting numbers and hidden financing
According to the proposed project, the budget for Torah schools was reduced to 367 million shekels (about 95 million dollars) compared to 1.7 billion shekels (about 442 million dollars) in the previous year.
However, reports indicate that these cuts are only superficial, as the deficit will be supplemented by coalition funds worth a total of 5.4 billion shekels (about $1.4 billion), according to the newspaper’s tracking.
Meanwhile, the budget of the Shas Party’s Education Network was listed at NIS 0.86 billion (about $224 million) instead of NIS 1.25 billion (about $325 million) last year.
However, Finance Minister Bezalel Smotrich made clear his intention to add a NIS 600 million (about $156 million) wage increase for teachers in this network, which was considered an unjustified wartime priority, according to Calcalist.
As for the independent education network affiliated with the religious Agudath Yisrael, a budget of 1.64 billion shekels (about 427 million dollars) was allocated to it, compared to 2 billion shekels (about 520 million dollars) in the previous year.
Despite the appearances, these cuts are expected to be restored via coalition funds in the last moments before the final vote, according to Calcalist forecasts.
A study reveals violations
A report issued by Or Rafel-Kreuzer, a data scientist at the Hebrew University, showed that religious education institutions received funding exceeding their legal entitlement by 334 million shekels (about 87 million dollars).
The report showed that the Independent Education Network received 1.63 billion shekels (about 425 million dollars) instead of 1.467 billion shekels (about 382 million dollars), a difference of 163 million shekels (about 42 million dollars).
As for the “Bani Youssef” network, it received 897 million shekels (about 234 million dollars) instead of 726 million shekels (about 190 million dollars), a difference of 171 million shekels (about 45 million dollars).
Lack of transparency and mismanagement
The report reveals that these networks are funded based on their actual needs and not based on clear legal standards.
Last August, the Budgets Department of the Ministry of Finance announced plans to reform the financing system by setting fixed budgets, but these reforms have not yet entered into force.
Calcalist concludes its report by saying that at a time when Israel is suffering from economic challenges and increasing war burdens, the financing of religious institutions is emerging as a pressing issue that reveals the lack of transparency and the exploitation of public funds to meet political agendas.
The report indicates that these practices not only harm the government’s credibility, but also increase public tension around spending priorities in light of crises.
