Thirty-Seventh Government of Israel and the Palestinians

The 2022 Israeli elections produced a right-wing bloc led by Benjamin Netanyahu, whose coalition of nationalist, religious, and ultra-Orthodox parties secured 64 of the Knesset's 120 seats.[1][2] The government was sworn in on December 29, 2022, after receiving the confidence of 63 Knesset members, with 54 voting against.[3] It was Netanyahu's sixth government and his return to the prime ministership after serving from 1996–1999 and from 2009–2021.[4]

The coalition comprised six parties: Likud, Religious Zionism, Otzma Yehudit, Noam, Shas, and United Torah Judaism.[3] The pre-election Religious Zionism slate, led by Bezalel Smotrich and Itamar Ben-Gvir and including Noam, won 14 seats — making it the third-largest slate in the 25th Knesset — and, despite that relative size compared with Likud's 32 seats, obtained major concessions during coalition negotiations.[5] The government was inaugurated with 31 ministers.[6] It included no Arab party representation; INSS reported that Arab citizens and leaders regarded elements of the coalition agreements and judicial program as a major socio-political challenge.[7]

Before the government's inauguration, the Knesset passed three legislative amendments intended to implement coalition agreements. A December 27, 2022 amendment increased the permissible number of ministers and allowed a person with a suspended prison sentence to serve as a minister. A December 28 amendment, submitted by Ben-Gvir, gave the national security minister general authority to establish policies and principles governing police activity, particularly investigations. A December 19 amendment tightened the conditions under which Knesset members could split from their factions without electoral disqualification.[8]

The government's published guiding principles stated that the Jewish people possess an exclusive and inalienable right to all parts of the Land of Israel and pledged to promote and develop settlement in the Galilee, Negev, Golan, and Judea and Samaria.[9] The same document stated that the government would promote peace with neighboring states while preserving Israel's security and historical and national interests.[9] These principles were required before the government could be sworn in but were described as political commitments rather than legally binding obligations.[9]

The Congressional Research Service reported that the coalition agreements' language asserting an "exclusive right" to the land between the Mediterranean Sea and the Jordan River appears to conflict with Palestinian statehood aspirations.[4] The agreements were not legally binding, but their implementation potential was assessed as affecting West Bank annexation, the legalization of outposts, minority rights, and Israel's relations with the United States and other countries.[4] The section concerning possible annexation of West Bank areas deferred the timing to Netanyahu's preference and his consideration of Israeli interests.[4]

The coalition's settlement agenda was presented by its proponents as strengthening Jewish settlement in Judea and Samaria, preventing the establishment of a Palestinian state, establishing "de facto sovereignty" in Judea and Samaria, and asserting Israel's historic right to the Land of Israel.[10] The coalition also committed to a negotiated process for legalizing an estimated 70 unauthorized outposts outside the West Bank security barrier.[5]

Bezalel Smotrich became finance minister and simultaneously received a position within the Defense Ministry carrying formal responsibility for civil affairs units administering West Bank matters.[11] His responsibilities included the planning commission overseeing West Bank settlement construction and home demolitions.[11] In February 2023, the cabinet created a Settlements Administration under Smotrich's oversight, and the military subsequently transferred to this political body authority to expropriate land in the West Bank, regulate its use, approve expansion of existing settlements, and determine whether Palestinian-built structures had been constructed legally under Israeli government rules.[12] Smotrich had publicly called for dismantling the Civil Administration and promoting sovereignty in the area.[13] By February 2023, he had received general responsibility for settlement planning and enforcement concerning illegal construction in the West Bank, while Defense Minister Yoav Gallant retained formal authority to intervene in his decisions with cause.[11]

Itamar Ben-Gvir became national security minister, with general authority over Israel's police, including personnel patrolling Jerusalem and its disputed holy sites.[4] He expected to oversee the Border Police, including units operating in the West Bank under Israel Defense Forces authority.[4] Ben-Gvir supported easing open-fire conditions for security forces and increasing their legal immunity.[4] A few days after taking office, he visited the Temple Mount/Haram al-Sharif, drawing condemnation or concern from Palestinians and several governments.[4] Netanyahu subsequently pledged to preserve the historic status quo at the site, under which only Muslims are permitted to worship there.[4]

The coalition's associated policy positions — developed in connection with the pre-election alliance between Smotrich's Religious Zionism and Ben-Gvir's Otzma Yehudit — included annexing the West Bank without granting Palestinians voting rights or civil rights in those areas, imposing the death penalty for terrorists, authorizing live fire against Palestinian rioters, and granting immunity from prosecution to IDF soldiers for military actions.[14]

The coalition agreements gave Religious Zionism authority over significant parts of the Civil Administration and related planning and construction functions in Judea and Samaria.[5][13] The Civil Administration was responsible for implementing policy toward both Jewish and Palestinian residents in Area C — approximately 60 percent of the West Bank.[5][13] An INSS analysis estimated that Area C contained approximately 400,000 Israelis and 280,000 Palestinians, and identified the administration's responsibilities as including planning, construction, infrastructure, real-estate regulation, electricity, transportation, environmental protection, work permits, and approvals for Palestinians entering Israel.[13]

The coalition agreement proposed transferring some or all powers of the Coordinator of Government Activities in the Territories (COGAT) and the Civil Administration from the Defense Ministry to a ministry expected to be headed by Smotrich.[15] Analysts warned that dividing Civil Administration responsibilities between ministries could create internal conflicts and that the Palestinian Authority might interpret the change as a breach of its understanding with Israel, thereby harming existing coordination.[15] A December 2022 INSS analysis described the planned transfer as a move from what it characterized as "slow annexation" toward "accelerated annexation."[13] Under the arrangement ultimately adopted, the coordination and liaison structure with Palestinian Authority systems remained under the Central Command and the defense minister.[13]

The INSS analysis anticipated that placing the Civil Administration's supervision unit under a Religious Zionist minister could lead to significantly increased enforcement against Palestinian construction while authorizing or regularizing Israeli outposts.[13] It warned that limiting Palestinian activity, increasing demolitions of Palestinian construction, and expanding settlements could produce violent resistance, a security escalation, and tension with Israel's allies and Abraham Accords partners.[13]

In January 2023, the government approved measures that Netanyahu described as intended to curb terrorism. These included reducing benefits for families of accused terrorists, accelerating home demolitions and West Bank settlement construction, reinforcing Israeli military and police units, and expediting gun licenses for Israelis.[11] Netanyahu characterized these as "targeted action on the terrorists and their immediate circle" and noted that the government continued to allow 150,000 Palestinians to work inside Israel, had reduced security checkpoints, and encouraged investment in Palestinian areas of the West Bank.[11]

In February 2023, the government advanced plans for nearly 10,000 additional settlement units in the West Bank and began a process to retroactively legalize nine outposts that had previously been illegal under Israeli law.[11] A Jerusalem Center for Security and Foreign Affairs analysis also reported that the government undertook to prevent unauthorized Palestinian construction in Area C and dismantle new unauthorized Palestinian buildings.[16] These decisions prompted strong opposition from U.S. Secretary of State Antony Blinken.[11]

On March 20, 2023, the Knesset passed legislation overturning parts of the 2005 law that had made Jewish settlements in portions of the northern West Bank illegal.[11] A State Department spokesperson called the legislation "extremely troubling," saying it contradicted Israel's prior undertaking to the United States and its commitments to de-escalate tensions.[11] Netanyahu's office responded that the government had "no intention of establishing new communities" in the areas covered by the legislation.[11]

On January 5, 2023, Israel's Security Cabinet approved a package of punitive measures against the Palestinian Authority following Palestinian diplomatic action at the United Nations seeking an International Court of Justice advisory opinion concerning Israel's control of the West Bank.[17] The measures included sanctions against senior Palestinian officials, withholding Palestinian funds collected by Israel, and halting Palestinian construction in Area C.[17] On January 8, Smotrich announced that NIS 139 million — approximately $39.6 million — in withheld Palestinian tax revenue would be redirected to families of Israeli terror victims.[17]

A Jerusalem Center for Security and Foreign Affairs analysis reported that the government denied entry permits to senior Palestinian Authority officials involved in the ICJ petition and to officials who had visited and congratulated Karim Younis after his release from prison.[16] The analysis also reported that the security cabinet decided to deduct approximately NIS 600 million — described as the total amount the Palestinian Authority paid to terrorists in 2022 — and to apply the 2018 deduction law concerning payments to Palestinian prisoners and their families.[16]

France, Germany, Japan, and other countries described these steps as "punitive measures against the Palestinian people, leadership, and civil society."[11] The government's Palestinian-related policies during this period also included continuation of restrictions under Israel's Citizenship and Entry Law, which prohibited residence status for Palestinians from the West Bank and Gaza who sought family reunification with Israeli citizens or residents, while permitting the interior minister to approve a quota of 58 humanitarian cases.[18] Civil-rights organizations petitioned the Supreme Court, describing the law as discriminatory and contrary to international law; approximately 10,000 Palestinians were reported to hold temporary stay permits under the system.[18]

The government also pursued limited steps intended to reduce tensions with the Palestinian Authority. These included increasing the share of Allenby border-crossing revenues transferred to the PA, lowering Israel's tax on fuel transfers to Ramallah, expanding tax-free imports, and granting permits for Palestinians to pray at Al-Aqsa Mosque when the security situation was deemed calm.[19] These measures followed Netanyahu's January 2023 visit to Jordan and were presented in the context of efforts to prevent escalation.[19]

At the Aqaba summit in Jordan on February 26, 2023, Israeli and Palestinian officials met in the presence of American, Jordanian, and Egyptian interlocutors amid escalating West Bank violence.[19] The joint communique reaffirmed all previous agreements, including the Oslo Accords, and called for a temporary restraint from unilateral measures.[19] Israel committed not to advance plans for new settlement homes for four months and not to advance legalization of West Bank outposts for six months.[19] The communique also referred to Jordan's custodianship role in Jerusalem's Muslim holy sites, although an Israeli official later characterized that wording as an oversight.[19] The parties reconvened in Sharm El-Sheikh in March 2023 and discussed empowering Palestinian security forces, curbing violence, improving Palestinian economic conditions, and resuming talks.[11]

JNS columnist Eran Lerman described the Aqaba understandings as exposing significant divisions within the coalition. In his analysis, one camp sought to undo the Oslo process, block Palestinian statehood, and reopen parts of the West Bank and possibly Gaza to Jewish settlement, while a more pragmatic camp favored conflict management, containing escalation, and avoiding actions that could damage Israel's regional and international standing.[20] Netanyahu authorized participation in the Aqaba framework but faced opposition from coalition partners to its restrictions on settlement activity and outpost legalization.[20]

The government's proposed judicial overhaul, introduced by Justice Minister Yariv Levin on January 4, 2023, sought to increase government influence over judicial appointments, limit the High Court's ability to invalidate legislation and government decisions, permit a Knesset override of certain court decisions by a simple majority, change the composition of the Judicial Selection Committee, reduce the authority of the attorney general's office, and eliminate the judicial "reasonableness" standard.[21]

Congressional Research Service analysis identified possible implications for Palestinian-related issues, including the potential legalization of Jewish West Bank outposts on private Palestinian land, which would otherwise face legal challenge under existing judicial-review standards.[11] The Knesset passed legislation abolishing the reasonableness standard for reviewing decisions by the government, the prime minister, and ministers on July 24, 2023.[22]

The judicial reform program triggered mass domestic protests throughout 2023. Critics argued that Religious Zionism and Otzma Yehudit had a particular interest in limiting judicial interference with settlement expansion on Palestinian land and policies affecting Israeli Arabs.[23] Supporters of the reform maintained that it was intended to correct what they described as an imbalance created by an activist High Court.[23]

The government's domestic direction also significantly affected Israel's Arab citizens, many of whom identify with both Israeli and Palestinian dimensions of identity.[7] An INSS survey found that 63 percent of Arab respondents considered their Israeli identity more important than their Palestinian identity, while approximately 80 percent supported political integration and a coalition that included Arab parties.[7] At the same time, 61 percent felt alienated because they believed Jews did not view them as equal-rights citizens or might regard them as potential enemies.[7]

The INSS described Arab citizens and leaders as viewing parts of the coalition agreements and the proposed judicial overhaul as a major socio-political challenge.[7] The absence of any Arab party from the coalition — a government whose agreements asserted exclusive Jewish rights to the entire land — was experienced by many Arab citizens as a statement of political exclusion.[7] A Jerusalem Center for Security and Foreign Affairs analysis described the government's security environment as including possible Palestinian uprisings in the West Bank, attacks from Hamas-controlled Gaza, and instability involving Arab citizens of Israel.[24]

Internal coalition disagreements over policy toward the Palestinian Authority were persistent and sometimes acute. In July 2023, Israel's security cabinet approved measures described as intended to prevent the Palestinian Authority's collapse; Smotrich abstained and Ben-Gvir voted against the measures.[25] In August, reports indicated that Smotrich opposed economic steps intended to assist the PA — including postponing action on approximately $500 million in PA tax debts — while Netanyahu and Defense Minister Yoav Gallant supported measures to stabilize the authority.[25]

These disagreements reflected the coalition's competing approaches: one that favored maintaining the Palestinian Authority as a security and administrative partner to prevent greater instability, and another that sought to weaken or confront the PA, viewing it as a hostile actor.[25] The disagreement persisted into 2024, when Smotrich used his authority over West Bank civilian affairs to restrict tax transfers and other economic support for the PA while Israeli security officials warned that weakening it could increase instability.[26]

On the eve of the war that began on October 7, 2023, approximately 175,000 Palestinians worked, with and without permits, in Israel and Israeli settlements in the West Bank; approximately 150,000 of these worked inside the Green Line.[27] The Palestinian labor force inside Israel represented a significant economic link between the two populations that the government had maintained even while pursuing assertive settlement and enforcement policies.

After the war began, the Israeli government prohibited Palestinian workers from entering communities inside the Green Line except through special permits.[27] These permits were reported to cover approximately 8,000 workers for exceptional essential needs, a dramatic reduction from the pre-war figure.[27] The restriction was part of the government's broader emergency response to the terrorist attack and reflected the security logic that had motivated earlier, partial restrictions during periods of heightened tension.

On October 7, 2023, Hamas launched a surprise attack from the Gaza Strip in which thousands of Hamas terrorists breached Israel's borders and attacked civilian communities and military bases.[28] More than 1,200 people were killed and 251 hostages — including Israelis and foreign nationals, and Jews, Muslims, and Christians — were taken into Gaza.[28][28] The Israeli government declared a state of war on October 8, and the Israel Defense Forces entered Gaza on October 27.[28]

Following the attack, five National Unity lawmakers joined the government on October 11, creating a national emergency government.[29] Benny Gantz, Gadi Eisenkot, Gideon Sa'ar, Chili Tropper, and Yifat Shasha-Biton became ministers without portfolio; Gantz and Eisenkot joined a war cabinet alongside Netanyahu and Defense Minister Gallant.[29] The arrangement strengthened the government's military expertise and reduced its formal reliance on its far-right coalition ministers in wartime decision-making.[30]

Gantz left the government in June 2024, after which Netanyahu again depended more heavily on his right-wing coalition partners.[30] In January 2025, Ben-Gvir and Otzma Yehudit resigned from the coalition in protest against a hostage agreement, leaving Netanyahu with only a razor-thin Knesset majority.[30] The party returned to the coalition in March 2025 after fighting resumed in Gaza.[30]

The Gaza war brought the government's internal divisions over Palestinian governance to a sharp focus. In May 2024, Defense Minister Gallant called for a postwar plan that would identify an alternative governing authority for Gaza, while Smotrich demanded that the government rule out Palestinian Authority involvement and stated that a government including him would not establish a Palestinian state.[31] Ben-Gvir called for Gallant's dismissal after Gallant challenged the government's lack of a clear postwar political plan.[31]

Netanyahu consistently opposed transferring control of Gaza to the existing Palestinian Authority unless major changes occurred to its leadership and programs.[32] He stated that Israel should retain freedom of military action in Gaza and create a buffer zone near the border.[32] Throughout 2024, the government continued withholding or restricting transfers of Palestinian Authority tax revenues collected by Israel; a Norway-managed mechanism was eventually created after Israel refused to transfer the funds directly to the PA.[32]

Smotrich continued during 2024 to use his authority over West Bank civilian affairs in ways that security officials assessed as risking PA destabilization. In June 2024, he was reported to have secured approval for legalizing five West Bank outposts and imposing additional sanctions on the Palestinian Authority.[26]

Many of the government's core policies received competing political and analytical interpretations. The coalition agreements' assertion of exclusive Jewish rights to all land between the Mediterranean and the Jordan River was identified by the Congressional Research Service as appearing to conflict with Palestinian statehood aspirations, though the agreements were not legally binding.[4] INSS described the proposed transfer of West Bank civilian-administration authority as a shift from "slow annexation" to "accelerated annexation," while also recording Likud's position that the reorganization would not change the territory's political or legal status.[13]

Congressional Research Service analysis identified the possibility that reduced judicial review could facilitate the legalization of outposts on private Palestinian land.[11] Supporters of judicial reform instead argued that the changes were aimed at correcting an imbalance created by an activist High Court.[21] Ben-Gvir's early visit to the Temple Mount and his advocacy for easing open-fire conditions drew international concern and condemnation from the Palestinian Authority and several foreign governments.[4]

A Jerusalem Center for Security and Foreign Affairs analysis cited the government's failure to resolve the status of the Bedouin encampment at Khan al-Ahmar as evidence that some announced measures represented continuity with earlier governments rather than a fundamental policy shift.[16] France, Germany, Japan, and other countries characterized the government's withholding of Palestinian Authority tax revenues and related measures as "punitive measures against the Palestinian people, leadership, and civil society."[11] The government defended the withholding as a counterterrorism response and a consequence of the Palestinian Authority's international legal initiatives and payments to convicted terrorists.[17][16]