New report pessimistic
Going down?
By 2009, Israel will be ranked last among developed countries in terms of government allowances, National Insurance Institute report says; poverty growing, gap between rich and poor deepening
TEL AVIV - As a result of sharp cuts in government allowances, Israel will be ranked last among developed countries when it comes to government assistance per capita, a National Insurance Institute report says.
The average allowance per child, once the cuts are completed, would stand at 2 percent of GDP, compared to 4.7 percent today.
National Insurance Director General Yigal Ben Shalom submitted the new report, which refers to 2004 figures, to Deputy Welfare Minister Avraham Ravitz on Monday.
“The review indicates that compared to other social services, National Insurance Institute allowances suffered the deepest cuts,” Ben Shalom said.
According to the report, social policies adopted in the past three years worsened Israel’s socioeconomic status as compared to other countries. Moreover, the increasing poverty figures place Israel in the unflattering second place among developed nations, behind the United States.
Should Israel follow British example?
Meanwhile, public expenditure on welfare, as calculated by the OECD, declined from 19.3 percent of GDP in 2002 to 17.7 percent in 2004. Overall, in the past three years child allowances declined by about 40 percent, while unemployment insurance payouts dropped by about 43 percent.
In the early 1990s, about 12.6 percent of Israeli families were defined as poor, compared to 18.3 percent in the United States. However, later Israeli figures grew increasingly similar to U.S. figures.
Local poverty figures have also increased compared to countries like Canada and England, which were similar to Israel in the early 1990s. In Britain, poverty rates were in fact cut down.
The report praised British policies aimed at reducing poverty and says England should serve as a model for a positive socioeconomic turnaround. According to the report, Britain set clear objectives in the fight against poverty, which were closely monitored.
On another front, recent tax reforms benefit mostly the rich and are expected to increase the gap between the country’s wealthy and poor, the report says.
