JERUSALEM â€” Israeli Prime MinisterÂ Benjamin NetanyahuÂ announced Tuesday night that he is disbanding his right-wing government and calling for early elections, blaming a coalition deadlock over how to slash nearly $4 billion from next year’s budget.
Speculation has been rife for months that Netanyahu’s inability to pass a 2013 budget would force him to dismantle what has been one ofÂ Israel’sÂ longest-serving coalition governments.
Parliamentary elections, which were expected to take place in October 2013, will probably occur by February.
Although most polls suggest Netanyahu and hisÂ LikudÂ Party will remain in power, the makeup of his next coalition could change if the budget becomes the driving issue, analysts say.
Amid a recent jump in government spending and a weakening economy, Israel’s deficit doubled during the first half of 2012 to $2 billion, causing concern in financial markets in Israel and abroad.
This summer, Netanyahu pushed through tax increases and other austerity measures, but they were enough to provide only a third of the revenue Israel needs to meet its targets.
After several weeks of negotiations, the prime minister said he was unable to reach an agreement with his coalition partners over where to make further cuts. Religious parties objected to reducing government benefits that many of their ultra-Orthodox supporters receive. Military hawks scoffed at proposed cuts to the Defense Ministry.
“At this time it is not possible to pass a responsible budget,” Netanyahu said Tuesday in a televised address. He said further increases to the deficit would risk plunging Israel into the kind of economic crisis plaguing some European countries. “I won’t let that happen here,” he said.
By disbanding the government, Netanyahu is hoping that if he is reelected he will have a renewed mandate to push through the needed cuts or it will allow him to create a coalition that will back him.
Critics, however, said Netanyahu was simply postponing painful, and probably unpopular, economic decisions.
It is the second time this year that Netanyahu has announced the disbanding of his government. In May, he called for early elections amid a political battle over whether to begin drafting religious students into the army.