ByJERUSALEM POST STAFF

JUNE 9, 2026 16:00

Updated: JUNE 9, 2026 17:06

Public organizations advance AI applications, yet shortfalls in funding, data oversight, acquisition processes, and national strategy slow progress from trials to full rollout.

Israel could lag in official use of artificial intelligence despite its technology prowess, research foundation, and talent pool, per a report issued Tuesday by the State Comptroller. The global review, directed by State Comptroller Matanyahu Englman as head of the European Organization of Regional Audit Institutions, evaluated government AI readiness across 12 European nations.

The results highlight what Englman termed an innovation paradox: Israel holds the tech strengths of a high-tech leader but has not converted them into a unified, coordinated, and actionable government strategy for AI integration.

Israel high-tech advantage reaches government too slowly

Artificial intelligence is not a future matter. It already transforms government operations, Englman noted. He stressed that audit bodies must review government preparations ahead of risks emerging, rather than afterward.

The results indicated AI adoption in government must enhance public service while upholding individual rights and public confidence. Execution should boost transparency, protect human rights, ensure prudent use of state assets, and deliver public services that are safer, more efficient, and more valuable.

No national AI roadmap despite new headquarters

Although the government endorsed the Nagel Committee recommendations in September 2025 via Government Decision 3375 and directed creation of the National Artificial Intelligence Headquarters in the Prime Minister Office, Israel had not endorsed a full long-term national AI strategy by the audit end date.

Such a strategy should encompass a vision, objectives, milestones, defined government accountability, schedules, funding, and evaluation and oversight tools, the results stated. The government decision specified that the new headquarters would align with the National Digital Agency on rolling out AI technology in the public sector.

The shortfall stands out because Israel starts from an unusually solid base. Its tech abilities, high-tech sector, research efforts, and human capital position it favorably in AI, yet those strengths have not translated into a complete government execution plan.

Public sector leaders recognize potential, but systems trail

The Office of the State Comptroller performed what it called the first broad mapping of its type regarding Israel public sector preparedness to adopt and apply AI. The results drew from replies by 70 major public entities, including most government ministries, statutory organizations, support units, hospitals, health funds, large municipalities, and additional bodies.

The survey revealed wide managerial awareness of AI value. In 77 percent of the entities, leadership gave high or very high priority to incorporating AI solutions; in 63 percent, a lead coordinating role existed in the area; and in 72 percent, staff training programs were already active.

The public entities reported 144 AI projects across 47 bodies. Of those projects, 42 percent aided the core operations of the ministry or entity, and 34 percent aimed to enhance citizen service, pointing to genuine scope for better public-sector results.

Most AI efforts stay limited to pilots

Despite rising AI activity, only 18 percent of the entities reported adopting a defined organizational strategy or policy for AI integration.

The results also showed that 34 percent of the entities had not started shaping a data strategy, while 41 percent functioned without a formal data-governance structure. These shortfalls could restrict the public sector ability to apply AI responsibly, since AI systems rely on high-quality, accessible, secure, and well-managed data.

Of the reported AI projects, 68 percent remained in development or pilot phases, while only 32 percent reached practical use. The results noted this indicates Israel public sector has not yet built the broad and mature base required to shift from isolated tests to safe, effective, and measurable application.

Funding shortfalls slow AI adoption

The results said 58 percent of participating public entities received no dedicated budget to advance AI projects during the examined years. Englman noted the lack of organizational and budgetary base in most public entities delays public service development.

About 80 percent of the entities identified dedicated funding as the support most required to speed AI adoption. Another 62 percent highlighted the need for training, while 58 percent called for more flexible procurement mechanisms.

To allow Israel to achieve its status as an innovation nation inside government bodies too, we must address the shortfalls emerging from the field, Englman said. Now is the moment to shape a national master plan that converts artificial intelligence tools into a driver for excellence in government service.

Autonomous AI decision-making stays uncommon

The survey found that 86 percent of participating public entities lack autonomous decision-making systems based on AI. The result suggests most public-sector AI use stays centered on support tools, service enhancement, internal efficiency, or projects that have not yet achieved full operational deployment.

The results placed this within the wider need for responsible rollout, legal and ethical rules, information security, privacy safeguards, and benefit-measurement tools before AI systems see wider use in public administration.

Weak data infrastructure risks broader rollout

Israel maintains a policy for information sharing, but public entities still encounter major barriers, including lengthy approval steps, regulatory and bureaucratic constraints, enforcement shortfalls, information systems that fail to connect with each other, and reliance on manual processes.

Without an orderly and measurable government data strategy, turning government databases into reliable infrastructure for data reuse, advanced analysis, and responsible AI application in public service proves difficult.

Responsible AI application must rest on high-quality data, proper data governance, information security and privacy, skilled human capital, and clear managerial accountability.

Civil servants require AI skills, not only AI tools

The report stated that human capital in the public service is vital to responsible AI adoption. Although Israel excels in technological human capital and research, the government needs complementary capability among civil servants, managers, regulators, procurement staff, legal advisers, information-security personnel, and internal auditors.

These officials must grasp AI technology in depth, evaluate its risks, oversee external suppliers, and confirm that its application serves the public.

Localized training falls short, according to the results. A cross-cutting policy is required to build AI literacy and competence across the public service.

Master plan required before gaps grow

Responsible AI application could become a key driver for improving public-sector efficiency and strengthening service to citizens. However, Israel must move from treating technological innovation as a localized effort to viewing AI as a cross-government capability.

A comprehensive government framework is needed, combining uniform policy, dedicated funding, secure data and cloud infrastructures, professional training, adapted procurement mechanisms, legal and ethical guidelines, and tools for measuring benefits.

Englman also addressed the state duties with AI. It is our duty to ensure that the adoption of technology promotes high-quality and efficient public service, while protecting individual rights and public trust, Englman said.

Background

Israel has already taken several steps toward expanding AI use in both government and regulation. These include the launch of a national AI program, the appointment of a head for the National AI Directorate, and government-backed regulatory sandbox initiatives.

Separate reporting has also raised questions about how the new AI authority will interact with existing government bodies involved in technology, cyber policy, and national security.