A failed colonial state: number of poor in Israel climbs to 1.63 million
By Ruth Sinai and Yoav Stern
(30 August 2006) THE poverty rate in Israel continued to climb in 2005, with another 47,000 Israelis, half of them children, being classed as poor, according to an annual National Insurance Institute report released Wednesday.
By the end of 2005, there were 1.63 million people living below the poverty line in Israel, including 410,000 families and 768,000 children. The overall figure represents roughly a quarter of the population.
Defense Minister Amir Peretz said Wednesday the National Insurance Institute's annual report on poverty does not adequately represent the changes that could come as a result of the government's new social agenda.
The minister said "it is important to remember that the current government has changed its priorities and taken action that did not appear in the current report, the first of which is increasing minimum wage."
Peretz added that "the demands of the defense establishment do not and will not come at the expense of the allocation of funds to decrease the gaps in the Israeli society."
MK Azmi Bishara said after the report was issued on Wednesday that Israel must decide between a policy of prosperity, growth and peace and one of preparation for the next war.
NII CEO Dr. Igal Ben Shalom warned of the extreme rise in the number of families with poor children, saying, "Children who are poor today will be the ones receiving stipends in years to come."
Ben Shalom called on the government to create a plan to reduce poverty among children from 35 percent to 15 percent within a decade. He said that this could be made possible by adding NIS 1 billion to the children's stipends every year.
The poverty line is set at a monthly income of NIS 1,866 for an individual and NIS 4,778 for a family of four.
The report found, however, that the poverty rate among the elderly has dropped.
The percentage of the elderly living below the poverty line fell from 25 percent in 2004, to 24.4 percent a year later.
The decrease in the poverty rate among the elderly can be attributed to the new old-age pensions and the 9-10 percent increase in the pensions of senior citizens with no other source of income.
The report is the second one to be published by the NII this year. The first, published in January, reflected poverty during the year between mid-2004 and mid-2005, while the findings published Wednesday reflect 2005 in its entirety.
The poverty rate in the north is higher than that in the rest of Israel
The poverty rate among families headed by only one wage earner has risen from 20.8 percent in 2004 to 23.1 percent in 2005.
In the north of Israel, the poverty rate was substantially higher than in the rest of the country. Roughly one of every three residents of the north is impoverished, representing a 31.6 percent poverty rate as opposed to the 24.7 percent rate in Israel as a whole.
40.5 percent of children in the north live under the poverty line.
The poverty rate has risen despite the decrease in unemployment
Poverty has risen in spite of the increase in the number of wage earner and the decrease in unemployment, because real wages rose mostly among the upper classes and degree-holders. The salaries of those with no higher education have gone down.
Since 1998 the number of impoverished children has seen a 55 percent growth, and at the end of 2005 35.2 percent of all children in Israel lived in poor families. This is due to the continuing drop in children stipends, which have gone down by 10 percent in 2005 and by 47 percent since 2001.
While tax reforms have decreased the expectations of a significant increase in poverty levels by raising the income of the upper classes, the "inequality index" measuring differences in income distribution between the rich and the poor indicated a rise in inequality in 2005.
Even though the inequality level in Israel is lower than that in the U.S., Mexico and Russia, it is higher than the level measured in all other developed countries.
Former Social Security CEO Yochanan Shtesman said Wednesday that governments have not done enough in recent years to reduce the number of poor people and that the stipend cutback has greatly worsened their situation.
"The tax reform has improved the situation of the upper classes and further intensified the gaps in society," said Shtesman in an interview to Israel Radio, and called for the immediate appointment of a full time minister of welfare.
Attorney Eran Weintraub, who heads the Latet food organization, warned yesterday that if the 2007 budget will not include a national plan to combat poverty, the organizations in charge of food and equipment distribution would have stop their activities. Even today, he claims, the organizations are unable to answer most of the needs of the poor.
"The problem of poverty is no lesser a threat to Israeli society than is the security threat," he said.
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