NGOs: PM's economic recovery plan not enough

Groups say details too vague and that the poorest sectors are unlikely to benefit

April 24, 2009 03:50
2 minute read.

Social rights groups expressed concern Thursday that the economic recovery plan presented by Prime Minister Binyamin Netanyahu and Finance Minister Yuval Steinitz did not go far enough to address socioeconomic issues and could ultimately damage social welfare services. "On the surface there are a lot of promises, but the details are still very vague," commented Ran Melamed, deputy director of Yedid, the association for community empowerment. While Melamed welcomed commitments to widen the welfare-to-work Lights to Employment program, and the continuation of negative income tax for low-income households, as attempts to aid weaker population segments, he cautioned that the plan to reduce taxes for middle-class earners would likely mean cutbacks to government spending. "There was no indication as to where those cuts would come from," said Melamed. "I feel sure they will not directly cut social welfare benefits, but there may be cuts in health or education, and that would not be good." Eran Klein, project manager at Shatil, the New Israel Fund's empowerment and training center for social change organizations, echoed this sentiment. "Reducing taxes at this time does not seem appropriate when the government should be trying to increase its budget and its investment to stimulate the market," he said. "While any program is better than nothing, we still do not have enough details that this plan will be effective in the areas that it is needed," said Klein "Reducing levels of income tax will not really help the poorest people in society," commented Barbara Epstein, executive director of the nonprofit Community Advocacy. "There are two theories of how to kick-start the economy - first is by improving the situation for middle- and upper-class people and watching the wealth trickle down. The other way is to increase benefits, raise minimum wage and reduce value-added tax to directly help the poorer people. I believe this must be done, too." Rimon Lavi, a social and occupational psychologist who researches socioeconomic issues for the Israeli Center for Occupational Justice, said government budget cuts usually meant that the "weakest segments of the population end up being hurt the most." Instead, he urged the government to increase such spending and invest in the public sector as a way of stimulating the economy and increasing employment with worthwhile salaries. "We suggest that the government improve work conditions in such fields as nursing, education or social work, enticing Israelis to enter these jobs and therefore restimulating the economy," he said. "Israel has a very small market and cannot compete with competition from abroad. We know that Israeli workers are more expensive than foreign workers, but the government needs to step in and subsidize them." Lavi pointed out that even if this were costly in the near future, it would have more positive impact in the long term. "It's worth it. Israeli employees are the ones who spend their money here," he said. "We really believe that economic recovery needs to come together with social development and investment."

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