Daily Israel Report

Lapid Seeks Unprecedented Deficit

Lapid wants to increase deficit goal to 50 billion. Sources close to PM say he’s working alone.
By Maayana Miskin
First Publish: 5/3/2013, 2:45 AM

Yair Lapid
Yair Lapid
Israel news photo: Flash 90

Finance Minister Yair Lapid has not involved Prime Minister Binyamin Netanyahu in his deliberations regarding the national budget, sources close to Netanyahu said Thursday.

They said Netanyahu was not aware of Lapid’s plan to increase the deficit target from 3% to 4.9%. The increase would mean allowing Israel’s deficit to grow to an unprecedented 50 billion shekels.

According to Channel 10 news, Lapid’s decision surprised Bank of Israel head Stanley Fischer as well. Fischer reportedly first heard of the news on Thursday evening as he landed in the United States.

The original deficit target for 2013 was 1.5%. Former Finance Minister Yuval Steinitz then raised it to 3%.

Lapid said shortly after entering office that he would deal with the deficit. “It’s time to deal with the overdraft. We’ll work hard, we’ll limit ourselves, we’ll reduce expenses, we will also have to cut where it’s most painful,” he wrote in a message to his supporters.

He also wrote that he is not afraid to make unpopular decisions.