Israeli prime minister has announced that he has accepted a proposal to extend budget negotiations, preventing the government from collapsing and plunging the country into a new election.

In a nationally televised address, Mr Netanyahu said that now was not the time to drag the country into an unwanted election.

“Now is the time for unity. Not for elections,” he said.

Mr Netanyahu and his rival and coalition partner, Benny Gantz, had faced a Monday night deadline to agree on a budget.

Israel's Benjamin Netanyahu accepts compromise to avoid election
Israeli Prime Minister with coalition partner Benny Gantz (Menahem Kahana/Pool Photo via AP)

Otherwise, the government would have collapsed and automatically triggered a new vote, the fourth parliamentary elections in less than two years.

Mr Netanyahu said that following a historic agreement to establish official relations with the United Arab Emirates, and with the country struggling with a coronavirus outbreak, he felt it was wrong to go to elections.

He said he accepted a compromise that would give the sides an additional 100 days to reach a budget deal, and in the meantime direct spending to struggling areas of the economy and society.

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