Home > Annual NII report shows 1.5m Israelis below poverty line
Economy-budget International Poverty-Precariousness
By Ruth Sinai
In 2004, 1.534 million people in Israel lived below the poverty line, according to a National Insurance Institution (NII) poverty report released Monday.
The figure attests to a substantial rise in poverty rates, with 100,000 more poor Israelis in 2004 than there were in 2003.
The report also shows that the number of poor families make up 20.3 percent of Israel’s population. The number of children living in poor families has reached 700,000.
After six years of relative stability, the year 2003 marked the start of the ascension of poverty rates. In that year, the number of poor families rose from 18.1 percent to 19.3 percent.
The report was released just as the 2006 budget is expected to come up for cabinet approval.
Before the publication of the report, NII officials quipped Sunday that outgoing Finance Minister Benjamin Netanyahu resigned to evade facing the 2004 poverty report to be released Monday.
While Netanyahu’s resignation is aimed at achieving a political agenda, he is identified more than any other politician as the one who damaged the country’s poor population, whose total reached nearly 1.5 million last year.
The poverty report shows the results of Netanyahu’s policy in the last two years - primarily the drastic cut in income allowance for which he is so proud. Intended to drive unemployed people to work, the cut was carried out in the middle of 2003, and its full effect was reflected in the 2004 poverty report.
The gradual cutback in child allowances, which began in mid-2003, also affected the poverty rate. Children’s allowances were slashed three times last year, and the move is scheduled to be continued through 2009. By then, the allowances of large families will be 70 percent lower than in 2003. The cutbacks apparently forced people to work, but according to 2004 Bank of Israel figures, most of the newly created jobs were part time, at very low wages.
The allowance cutback on the one hand, and the part-time jobs and low pay on the other pushed tens of thousands of Israelis below the poverty line.
"Netanyahu’s resignation came too late for 1.5 million Israelis, 700,000 of whom are children," attorney Yuval Albashan, the director of Hebrew University’s legal clinics and a leading social activist, said. "Netanyahu restored ideology to the public discourse. He accelerated the privatization and cutback trends, and these are the results," he said.
The main result of the outgoing minister’s policy is an increase in inequality. The Central Bureau of Statistices (CBS) reported last week that the index of the gap between the rich and poor increased reached 0.379 in 2004, compared to 0.370 in previous years.
Members of the Yadid association, which aids the needy, said it received 50 percent more requests for help last year, primarily from people who could not meet their mortgage payments and had accumulated heavy debts due to the treasury having slashed their income.
"We are witnessing the emergence of two new poverty sectors - the working poor and the new poor," said Yadid Director General Sari Rivkin. The working poor are those who managed to find work at a meager pay dooming them to continued poverty. The new poor are those who used to belong to the middle class but cannot meet their mortgage payments or buy medication, school books and other items.
The association issued a list of the government’s broken promises for 2004: It promised to feed 100,000 school children, but provided meals for only 30,000; it promised to find profitable work for thousands of single mothers whose allowances were cut, but only 600 of them managed to increase their income to the minimal amount qualifying them for a grant promised by the state; it slashed the budget for professional training by 50 percent and drastically reduced the number of people eligible to attend courses.
"Perhaps the depression is over for a small number of families, but the standard of living has not risen in 2004 among the lower percentiles," members of Yadid said.
Netanyahu reiterated Sunday that if the government continues his policies, economic growth will continue, and the standard of living of the lower percentiles will rise.
But NII officials find it difficult to believe. They predicted in November that things would only get worse. Over 1.4 million people, or 22.4 percent of the population, were classified as poor last year. That number included 652,000 children, representing 30.8 percent of the country’s children. After six years of stability, the number of poor families rose sharply last year from 18.1 percent to 19.3 percent of all families.