The Israeli parliament voted early on Thursday to approve the government's proposed budget, avoiding the need for fresh elections.

The Israeli parliament, the Knesset, passed the 2021 state budget into law with 61 votes in favour, out of 120 members of parliament.

This gives Israel a new budget for the first time since March 2018, the Jerusalem Post newspaper reported online.

The budget being approved was a crucial step for the governing coalition under Prime Minister Naftali Bennett to remain in place.

"A holiday for the state of Israel," Bennett tweeted. Fresh elections would have been required had the budget not passed.

Last year, the government under long-time prime minister Benjamin Netanyahu failed to agree on a budget. The Knesset was dissolved shortly before the end of the year. Elections were then called in March, establishing the current government.

Following the vote on the 2021 budget, the Knesset then began voting on the 2022 budget. A parliamentary spokesperson said the vote would not be concluded before late on Thursday.

Bennett's Cabinet was sworn in in mid-June, ending a fractious time in Israel politics, with four elections in two years.

However, Bennett's government coalition only has a wafer-thin majority in parliament. It is supported by a total of eight parties from the right to the left - including an Arab party for the first time.

Bennett has called on the coalition partners to stick together so as not to endanger their parliamentary majority.

Jonathan Rynhold, professor of politics at Bar-Ilan University near Tel Aviv, says Bennett's government is strengthened for the time being.

Rynhold said he assumed that the government will stay together as long as opposition leader Netanyahu remains a threat to the coalition.

Since the last budget was passed - in March 2018 for 2019 - Israel has been governed on the basis of the previous year's budget.

dpa