Finance and Defense ministry officials on Monday revealed some of the provisions of their five-year defense budget agreement, which includes major pension reforms, streamlining measures, and added transparency. The officials say the measures are expected to save 1.5 billion shekels ($380 million) starting in 2026. Some provisions are still pending approval by the cabinet or the Knesset. Under the agreement, the defense budget will receive a total of NIS 59 billion ($15 billion) per year between 2016 and 2020, with NIS 56 billion ($14 billion) coming from the regular state budget, and NIS 3 billion ($800 million) more in supplemental funding to cover added costs and certain projects. The agreement also stipulates that any new project covered by the agreement will be funded separately. According to one provision, any "major" military undertaking or war will be covered separately and will have no bearing on the agreement. The five-year budget is contingent on various streamlining measures to which the IDF has agreed. It will also put a new retirement mechanism in place to reduce the number of career soldiers. Currently, career soldiers have an "exit gate" to leave the military at the age of 26 or 28, but the new measures will set an "exit gate" at the age of 34 or 35, providing those who retire then with a severance package of up to NIS 500,000 ($130,000) each. Around half the IDF's career officers are expected to leave before this age. Of those who remain, officers promoted to the rank of lieutenant colonel or higher will retire toward the age of 42, while the retirement age for noncommissioned officers will be extended to 53. "We have had enough budget fights," Defense Ministry Director General Dan Harel told reporters on Monday. "That is why we sat together and ironed things out in this building." The director of the Finance Ministry's Budgets Department, Amir Levi, also praised the deal. "We got many things done," he said.
