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Knesset passes first reading of national housing project
February 11, 2014 21:56
If passed in 2nd and 3rd readings, will create a new institution to oversee planning.
Construction worker (illustrative)

Construction worker 521. (photo credit:Baz Ratner/Reuters)

The Knesset late on Monday night approved the first reading of a national housing project to advance building in priority areas.

If passed in its second and third readings, the plan drafted by Finance Minister Yair Lapid and Construction and Housing Minister Uri Ariel’s “90 days” committee will create an institution to oversee new planning called the Committee for the Preferred Housing Program (Vatmal in its Hebrew abbreviation).

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The committee would have authority to approve programs for tens of thousands of housing units, and is intended to reduce the cumbersome bureaucracy surrounding the building process. The World Bank currently ranks Israel a meager 140th out of 189 countries in its building and construction bureaucracy index.

The bill would give the state greater latitude in redesignating agricultural land near cities that is under government control for building.

The process of redeeming land from agricultural lessees or other rights-holders takes years, according to the Finance Ministry, significantly delaying the ability to market that land for residential building.

The bill is one of a number of steps the government is taking in an attempt to quash the persistent rise of housing costs, which according to the Bank of Israel continue at an annual rate of about 8 percent.

Out of a series of 10 “umbrella agreements” in strategic cities around the country, which include up-front funding from the government for infrastructure, three have already been signed. It has also drawn up a plan to add 150,000 rental units to the market over a decade.

Ariel also told The Jerusalem Post last week that he was considering reducing part or all of the 18% value-added tax associated with new construction.

The Knesset Interior Committee on Tuesday determined that 20% of any project with over 100 units would have to be designated as small, affordable housing units.

The Forum for Public Housing on Tuesday criticized the program, predictably, for focusing on affordable housing instead of increasing public housing.

MK Miri Regev, who heads the committee, said the option remained under discussion with the Finance Ministry.
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