Israel's generals have warned the government that if the IDF does not receive an urgent supplement to its budget, it will be forced to ground part of the air force, cancel regular exercises and freeze most of its procurement plans.

In a blatant media campaign, the IDF's top brass leaked this week that, due to defence projects forced upon it by the government, the army has a NIS 3.6 billion (£610 million) hole in its budget.

To deal with the deficit, the army said that it would be forced to cancel dozens of combat exercises this year, ground some of the air-force's squadrons, cut thousands of hours of flight-time, stop production of the advanced version of the Merkava tank and freeze orders for new batteries of the Iron Dome anti-missile defence system.

The senior officers warned that the IDF was being forced to return to the level of training before the 2006 Second Lebanon War, for which many units were not combat-ready.

In an appearance at the Knesset Foreign Affairs and Defence Committee on Monday, Deputy Chief of Staff Major General Yair Nave said that "we are in crisis mode. The IDF does not have a definite fiscal plan for 2012, it is just taking it day by day."

Gen Nave warned the Knesset members that satellite surveillance would also be harmed. "An insurance policy costs money," said GenNave, "and the money we have now does not allow us to improve Israel's security."

Finance Minister Yuval Steinitz, who failed last year to push through a cut in the defence budget to pay for the government's new social programmes, responded furiously to the military media onslaught, saying: "The defence budget is nearly NIS 60 billion (£10 billion) and that's the highest it has ever been. How can the army present a rise as a cutback?"