Shekels money 370.
(photo credit:Ariel Jerozolimski/Bloomberg)
A study released this week claims that failure by the government to enforce a
Basic Law mandating that all government employees work within the capital has
cost the city more than NIS 760 million over the past five years.
study, conducted by Jerusalem-based economic expert Uri Dahan, was commissioned
by Jerusalem City Council member Meirav Cohen of Awakening in
According to Cohen, over 4,000 employees from various
ministries are currently working outside Jerusalem, defying the 1980 Basic Law
decreeing that all government employees based in Jerusalem must work within the
“In 2007 there was finally a government decision declaring that by
2015 all public bodies and government institutions would be based in Jerusalem,”
“However, presently there are still over 4,000 government
employees working and living outside the city, which has prevented the infusion
of hundreds of millions of shekels into our economy.”
The study found
that 80 percent of people who work in Jerusalem also live there, thus directly
benefiting the capital’s economy. Furthermore, it concluded that, based on three
economic metrics, if the 4,000 workers came to live and work in Jerusalem, over
NIS 760m. would be generated within a five-year period.
economic variable takes into account property tax (arnona), which the report
found would generate NIS 200m. over five years.
The second variable is
based on what the study called an “employment multiplier,” which concluded that
the ratio between employment and government industrial expenditures would create
NIS 94m. in five years.
Most significantly, the third variable of the
study found that over NIS 470m. would be infused into the economy based entirely
on cost-of-living expenses, including rent, home purchases, food costs,
entertainment expenditures and general spending of disposable
“Our research shows that during a five-year period, these
government employees will buy and rent homes and spend much of their disposable
income into the local economy,” said Cohen.
“For example, we found that
if you have someone working and living in Jerusalem, they will spend NIS 5,349 a
year on fruit and vegetables alone,” she continued.
“However, if that same person lives
in Tel Aviv and works in Jerusalem, he will only spend NIS 662 a year in this
city. It’s a big difference that adds up.”
Cohen said the fault for not
enforcing the Basic Law’s mandate lies with the government itself, which she
said could solve many of Jerusalem’s economic woes by finally sanctioning
“If the government did what it said it would do by moving all of its
offices to Jerusalem, then hundreds of millions of shekels would be pouring into
the city’s economy, and Jerusalem wouldn’t be one of the poorest cities in
Israel,” she said.
“Every year when Jerusalem Day comes, people discuss
the importance of the city and how it is supposed to be the political and
cultural epicenter of Israel, but when it comes to practice, the government just
isn’t doing enough,” Cohen added.
Relevant to your professional network? Please share on Linkedin