State Comptroller Matanyahu Englman delivered a stinging assessment on Tuesday of the government’s socioeconomic cabinet, warning that years of neglect and disorganization left the body unable to perform its duties during the Israel-Hamas War – even after the government expanded its powers to lead the home front’s civilian response.
According to the Comptroller’s Office report published on Tuesday, the sixth in its series on the war, the cabinet, meant to coordinate the government’s economic and social policy, saw its activity shrink dramatically over the past decade, culminating in near-total paralysis during wartime.
The socioeconomic cabinet was created to serve as the government’s main decision-making forum on civilian and economic affairs. After October 7, the government empowered it to oversee all civilian aspects of the war effort, effectively positioning it as the lead mechanism for managing the home front’s social, economic, and welfare response.
But according to the report, the cabinet entered that period in an already weakened state. Between 2003 and 2022, the overall number of its adopted resolutions dropped by about 90%. A growing share of decisions were made without any discussion – rising from 8% in the 30th government (2003-2006) to 100% in the 35th (2020-2021) and 50% in the 36th (2021-2022).
Attendance by ministers at meetings was partial, and the cabinet repeatedly avoided dealing with strategic core issues under its authority, like labor productivity, demographic aging, Israel’s credit rating, cost-of-living reforms, and the country’s preparedness for economic emergencies.
The report noted that previous cabinet leaders failed to address the body’s mandated emergency preparedness role, despite repeated professional recommendations to do so.
Northern Crisis Deepens as Smotrich Cabinet Collapses
At the onset of the Israel-Hamas War in 2023, Finance Minister Bezalel Smotrich (Religious Zionist Party) was appointed to head the cabinet and oversee all civilian aspects of wartime management. Yet, the report describes the cabinet’s wartime activity as “extremely limited.”
By mid-December 2023, the cabinet had stopped convening altogether, leaving core civilian issues – from displaced residents in the North and South to labor disruptions – without coordinated oversight.
A command center established within the Finance Ministry to act as the cabinet’s operational arm functioned for less than three months before collapsing. The comptroller further found that it faced “significant operational difficulties” and “did not fulfill its purpose.”
According to the report, the center’s head submitted a series of complaints about the lack of direction and support. Smotrich responded that the failure stemmed from “significant obstruction” by legal and professional officials in the Finance Ministry, Justice Ministry, and Civil Service Commission, who, he claimed, hindered its establishment and activities.
Those officials told Englman that they assisted the process “and did not create obstacles.”
The cabinet’s failure, the report found, was felt most acutely in the North, where communities under prolonged attack from Hezbollah faced deepening social and economic crises without a unified governmental plan to aid them. Responsibility for relief and rehabilitation shifted between ministries, resulting in fragmented assistance and delayed action.
A comprehensive government plan for northern communities was approved only at the end of May 2024 – more than six months after the war began. As of June, no multi-year rehabilitation framework had yet been formulated, despite ongoing displacement and economic hardship among residents.
The comptroller’s review holds Smotrich responsible for failing to exercise his powers to set the cabinet’s agenda and convene meetings, resulting in its complete inaction. But it also places accountability with Prime Minister Benjamin Netanyahu, who, after the Cabinet ceased operating in December 2023, “should have intervened to ensure a comprehensive civilian management framework” but did not.
“The prime minister or his deputy, the finance minister, must ensure that the socioeconomic cabinet fulfills its role as a leading governmental forum,” Englman wrote. “Its work must rely on continuous staff preparation, updated data, and situational assessments that reflect evolving civilian needs.”
Englman’s findings call on Netanyahu and Smotrich to revitalize the cabinet’s agenda with substantive policy planning in both routine and emergency conditions. He further recommended creating a dedicated professional body to coordinate the staff work of the cabinet and other social-economic ministerial committees – a structure modeled on the National Security Council, which supports the government in defense and foreign affairs.
Such a mechanism, the report explains, would enable the cabinet to function as Israel’s central forum for deep, coordinated policymaking, ensuring the state can manage not only military crises but also their civilian aftermath.
Beyond the specifics of wartime management, the findings deliver a broader warning: the government, the report suggests, has lacked an integrated civilian governance structure for years, leaving vital economic and social issues to drift between ministries even during emergencies.
“Israel faces long-term structural challenges – demographic, geopolitical, and social,” the report reads. “To meet them, the government’s socioeconomic arm must be active, informed, and continuous. At present, it is none of these.”