JERUSALEM, May 23 (Xinhua) -- Thousands of Israelis rallied outside the Knesset (parliament) building in Jerusalem on Tuesday night as lawmakers gathered for marathon votes on a contested state budget.

The demonstrators' leadership criticized in a statement that the budget will allocate "an unprecedented" amount of money to Prime Minister Benjamin Netanyahu's allies, Jewish ultra-Orthodox and pro-settler parties. They chanted against "the plundering state budget" and lifted a banner reading: "Looters' government."

A series of votes in the parliament on the budget is scheduled to begin in the evening, with the final vote expected to take place in the early morning hours of Wednesday.

Speaking at the start of his coalition meeting in the Knesset, Netanyahu said: "Today we are passing a responsible budget."

Centrist leader of the opposition, Yair Lapid, said in a televised statement that under the new budget, the government will allocate 14 billion shekels (about 3.8 billion U.S. dollars) to Netanyahu's political allies, ultra-Orthodox and pro-settler parties and organizations, instead of spending them on creating growth engines for the Israeli economy, welfare and fighting Israel's skyrocketing cost of living.

"This budget is a disaster for the country's economy," Lapid said.

Passing the budget has been widely perceived as a major test for Netanyahu's governing coalition, which was sworn in in late December. The far-right and ultra-religious government needs to pass the budget before an end-of-the-month deadline or the Knesset will be dissolved, a move that could lead to a new round of elections.

With a stable majority of 64 seats in the 120-seat Knesset, Netanyahu seems sure to pass the budget. However, the budget stirred nationwide controversy, with critics voicing concerns that increased allocations of subsidies to ultra-Orthodox Yeshiva (Jewish seminary) students might slow growth.

In an earlier rally in the morning, seven protesters were detained on suspicion of throwing two smoke grenades near the Knesset and blocking roads, the police said in a statement.

Netanyahu and key coalition partners reached an agreement on Sunday after days of disputes, with two parties threatening to boycott the budget vote if their priorities were not met.