Published by Global Banking & Finance Review®
Posted on March 25, 2026
5 min readLast updated: March 25, 2026
Add as preferred source on GoogleIsraeli PM Netanyahu is rushing to pass the 2026 state budget—amid surging defense spending due to the Iran–Israel war—to avert a snap election that opinion polls show he’s unlikely to win.
By Maayan Lubell and Steven Scheer
JERUSALEM, March 25 (Reuters) - Israeli Prime Minister Benjamin Netanyahu is racing to pass a state budget and stave off early elections he would likely lose, with the war in Iran so far doing little to improve his standing in the polls.
In the war's first days, Netanyahu's camp saw a chance for his right-wing coalition to capitalize on the opening salvo that killed Ayatollah Ali Khamenei by holding elections ahead of an expected October date, a source familiar with Netanyahu's political strategy said.
One way to force snap elections would be to let parliament fail to pass the budget by March 31, which under Israeli law would trigger a vote within 90 days. As U.S.-Israeli strikes killed a host of top Iranian figures, some of Netanyahu's confidants publicly floated the idea of a June vote.
But nearly four weeks into a war that has so far failed to achieve a stated objective of toppling Iran's clerical rulers, Israel's longest-serving prime minister is looking to stave off early elections, three members of his government told Reuters.
That effort to avoid an early contest has included allocating funds to political allies to secure a majority vote for the budget in parliament, and rushing it through the chamber's Finance Committee to meet next week's deadline.
Netanyahu's political spokesperson did not respond to a request for comment.
In public remarks since 2023, Netanyahu has consistently rejected calls to bring elections forward at a time of war.
"I hope the government fulfils its term ... meaning elections in September or October," Netanyahu told reporters on March 12, saying that he had appealed to allies to be responsible at a time of war and pass the defence-heavy $225 billion budget.
STALEMATE IN POLLS AS WAR DRAGS ON
For Netanyahu, the war has helped him pivot attention away from Gaza and toward his joint campaign with the U.S. against Iran, where national consensus is strongest. Surveys have shown wide support among Israelis for a war that Netanyahu says is meant to eliminate an existential threat.
But when it comes to votes, election polls are showing a picture largely unchanged since October 7, 2023, when the Middle East was plunged into turmoil by Hamas' surprise attack, leaving Netanyahu's security credentials in tatters.
Polls consistently show around 40% of voters sticking with Netanyahu's coalition of nationalist and religious parties, 40% backing opposition parties and a swing vote so far not moving to Netanyahu, said Gideon Rahat, a political scientist at the Hebrew University in Jerusalem.
Even if Israelis rally in support of the war's goals, they are growing weary as it drags on with no decisive end or diplomatic resolution in sight, after a shorter round of fighting in June, said Rahat.
"You have one round, a few months of quiet, and then another round," he said.
A poll published by the Times of Israel on March 19 showed Netanyahu's Likud party would win 28 of the Knesset's 120 seats, down from 34 at present. While Likud would be the largest party, his coalition would fall short of a majority, securing only 51 seats, the poll said.
On March 3, Israeli Science Minister and Likud party member Gila Gamliel told local radio that the election will be held in late June or early July. Senior party members and Netanyahu aides made similar remarks to Israeli media.
In the weeks since, Netanyahu has acknowledged there was no certainty Iranians will overthrow their rulers. As the war nears a fifth week, the prospect of a summer election appears remote.
"His strategy is buying time," said Rahat.
BUDGET DEADLINE NEARS AS WAR COSTS SOAR
With schools shut and workplaces only partially open, the Iran war is costing the economy five billion shekels ($1.6 billion) per week, according to Finance Ministry estimates.
Netanyahu's government has also had to approve an additional 32 billion shekels for defence costs since the Iran war started.
With defence spending climbing sharply, there is less money available to satisfy demands from key constituencies whose backing Netanyahu needs in parliament -- including ultra-Orthodox Jewish parties, who left his government in 2025.
Those parties had threatened to vote against the budget if legislation was not first finalised exempting ultra-Orthodox from mandatory service in Israel's conscript military, an issue that has plagued Netanyahu's alliance with them since 2023.
But they appear to have backed down on their threat after Netanyahu's coalition allocated around five billion shekels for ultra-Orthodox schools this month. Spokespeople for the parties, Shas and UTJ, did not respond to requests for comment.
Vladimir Beliak, an opposition member who sits on parliament's Finance Committee, said that by approving those funds, Netanyahu's government has opted for "coalition survival over fair distribution of resources."
Adding to Netanyahu's political challenges is his long-running corruption trial on charges of fraud, bribery and breach of trust, which he denies.
Netanyahu, with support from U.S. President Donald Trump, has appealed to Israeli President Isaac Herzog for a pardon. A mid-trial pardon would be unprecedented and Israel's justice system has argued against it.
($1 = 3.1192 shekels)
(Additional reporting by Dedi Hayun and Tamar Uriel-Beeri; Editing by Rami Ayyub and William Maclean)
The ongoing Iran war has not significantly improved Netanyahu's poll numbers; his coalition support remains around 40%.
If the budget is not passed by March 31, Israeli law mandates snap elections within 90 days.
The war is estimated to cost Israel five billion shekels ($1.6 billion) per week, with additional billions allocated for defense.
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