So what’s grabbing the news headlines in Israel? Will Iran go nuclear? The true cause of Arafat’s death? Why poor rainfall is not causing a drought?

None of these. The question of the day is why does Israel have billions of extra dollars in its treasury and what to do about it? Such are the problems of life!

Step back. Twelve months ago, as Israel entered a general election, it was generally agreed that around 15 billion shekels, say US$4.5 billion, of expenses had not been financed. By the summer, the Minister of Finance had managed to secure a package, which included raising VAT by 1% to 18% and cuts in various social security payments. Very painful.

Today, there is a very different picture to describe.

• Targeting ‘trapped profits’ of large companies such as Teva, 4.4 billion shekels was secured, when only 3 billion had been hoped for.
• Government spending is at least 6 billion shekels lower than predicted (up to October 2013).
• On-going tax collection has resulted in an additional billion shekels beyond what was budgeted.

By my maths, that makes the country 11-12 billion shekels better off than had been foreseen even six months ago.

There are still large problems to overcome. The Defense Ministry is demanding a large slice of this extra cake. The government and port unions are probably on a collision path, which could impact on export revenues and more, maybe commencing next week. Politicians are demanding a retreat from the high level of VAT. etc etc.

In fact, the true test for Yair Lapid, the finance minister, is just about to begin. Introducing tough economic measures just after a general election was not easy, but he had a mandate. Kudos for his political courage. However, managing successfully the fruits of that policy will be even more difficult. Now for some real work.