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Thursday, March 10, 2011     INTELLIGENCE BRIEFING

Bank of Israel: Defense Ministry over budget
six years running

JERUSALEM — The Israeli Defense Ministry has consistently exceeded its budget, a report said.


The Bank of Israel determined that the Defense Ministry, responsible for the military, exceeded its budget in 2010. The bank report said this marked the sixth straight year that the ministry was unable to maintain its budget.

The report, released by the bank's research division on Feb. 22, said the Defense Ministry acted differently from other Cabinet departments, which remained in their budgets, Middle East Newsline reported. Titled "Economic Developments in Recent Months," the report said the Defense Ministry's overspending was difficult to explain over the last two years, in wake of the war with Hamas in 2009.

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Israel allocates about $11 billion per year for the Defense Ministry, nearly $3 billion of which comes from U.S. military aid. In 2009, the Cabinet approved a multi-year budget for the military, which included procurement.

The report, which covered the period of September through December 2010, said the Defense Ministry also spent funds in the budget reserve. The ministry was said to have spent 10 percent of its budget in December.

The Finance Ministry and central bank have been pressing for greater fiscal accountability by the Defense Ministry. So far, the ministry has not complied although it has promised greater transparency.

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