The Financial Times reports on demonstrations by around 10 – 15,000 Israelis on Saturday evening, who protested against the proposed budget set out by Finance Minister Yair Lapid, which is set to raise taxes and cut public spending. Israel’s government will vote on Lapid’s plan today, which has been the subject of public and media scrutiny over the past week, especially after Lapid had campaigned during January’s election on a platform of relieving financial pressures on Israel’s middle classes. Against this backdrop of impending financial cutbacks, the Telegraph, Guardian, Independent, Times and Independent i all report on revelations in the Israeli media that Prime Minister Benjamin Netanyahu requested a specially fitted £90,000 bedroom, in the aeroplane flying him and his wife Sara to London in order to attend Baroness Thatcher’s funeral last month.

Meanwhile, the online edition of the Guardian reports that Israel’s military grounded a fleet of un-manned surveillance drones after it intentionally crashed one of the aircraft due to a malfunction on Saturday night. The Times includes an article on a fringe Jewish religious group in Israel which is claiming that comments made by European Union foreign affairs chief Catherine Ashton in defence of religious freedom in Jerusalem is tantamount to a statement of support to institute Jewish prayer atop the Temple Mount, currently outlawed by Israeli authorities, although the site is holy to Jews and Muslims.

Elsewhere in the region, the Guardian, Financial Times and the Times report that Turkish and Syrian leaders have blamed each other for a double bomb attack in a Turkish town near the border between the two countries on Saturday, which killed at least 43 people. An editorial in the Times says that the bombing is further evidence that the Syrian conflict is on the brink of further explosion in the region, compelling Western powers to directly intervene, even reluctantly. In Syria itself, the Financial Times reports that four United Nations’ peacekeepers, who had been abducted by an extreme Islamist Syrian opposition group, have been freed. The Times notes that Israel’s Prime Minister Netanyahu is set to meet Russia’s President Putin in an attempt to persuade him to cancel an arms sale to the Syrian regime.

The Telegraph covers a massive 41-nation minesweeping naval drill set to take place in the Gulf today, which it describes as “an international show of force after Iran threatened to close the Gulf.” Meanwhile, the Telegraph and online edition of the Guardian report controversy in Iran after outgoing President Ahmadinejad appeared to contravene election rules by accompanying his preferred candidate to register for this summer’s presidential vote.

The fall-out from Prof Stephen Hawking’s decision to withdraw from an Israeli conference last week continues. Daniel Johnson accuses Hawking of hypocrisy in an op-ed in the Times, saying that his decision “”boosted a campaign that aims to eradicate the Jewish state.”

In the Israeli media, most front page headlines are focused on today’s cabinet vote, which is expected to approve Finance Minister Yair Lapid’s controversial budget proposals. Israel Hayom calls it the “Day of Austerity Measures,” while Makor Rishon predicts that the budget plan will be approved by a large majority of ministers. Nonetheless, Haaretz says that it is likely to require marathon talks for the cabinet to reach agreement on the exact composition of proposed cuts and taxes. Israel Radio news reports that the security cabinet will reconvene this morning after lengthy talks yesterday failed to produce agreement on the extent of cuts to the defence budget as part of Lapid’s wider financial plan.

Meanwhile, Maariv reports that Labour Party head and Leader of the Opposition, Shelly Yachimovich met yesterday with Palestinian Authority President Mahmoud Abbas. She warned that he could be the last Palestinian leader to be a potential peace partner. Maariv also reports that Israel’s Civil Administration, responsible for civilian affairs in the West Bank, has approved the construction of a new Palestinian city near Jericho, slated as a housing option for Palestinian Bedouins currently residing in illegal housing in the Jordan Valley. The report says that settler organisations are angry at the decision.