Report: Poor get poorer, despite growth

Child allowances were cut by 45% between 2001 and 2005, as welfare spending was reduced 12.4% in real terms to NIS 38b. in 2005.

November 21, 2005 07:09
2 minute read.

Despite economic growth and improvement - and the government's stated goal of social empowerment - the situation of the poor in Israel continues to worsen and social disparities continue to widen, the Taub Center for Social Policy Studies in Israel said Sunday, ahead of the release of its 2005 report on the allocation of resources to social services. Actual social spending in 2004 totaled NIS 91.3 billion, NIS 2.2b. less than the NIS 93.5b. budgeted for that year, and no improvement was visible in the current year or the planned 2006 budget, the center said. "The extent of social spending for next year is on a similar level to that of the current year, so average spending per capita will be even lower," the center said, adding that even if the full amount of the addition to the budget were directed to social spending, that would not be enough to cover the 11 percent drop accumulated in 2002, 2003 and 2004. Per capita consumer spending rose 6% from 1999 to 2004, as the government's social spending dropped 11% in real terms, the center noted, commenting that "These opposing trends illustrate the direction in which social services are developing, and their tendency in recent years to rely more and more on self-funding by the public using them." Investment in developing schools and building classrooms fell from an average of NIS 1.1b. over the years 1998 to 2001 to NIS 500 million in 2004, while health spending fell from NIS 360m. per year in the years 1998 to 2002, to NIS 153m. in 2004, the Taub Center said, arguing that these cuts have resulted in "accelerated deterioration, infrastructures in danger of collapse, and intolerable burdens of shortages of hospital beds and school classrooms." Child allowances were cut by 45% between 2001 and 2005, as welfare spending was reduced 12.4% in real terms to NIS 38b. in 2005. "The cancellation of some fundamental arrangements, such as linkages to relevant indices, was done without in-depth professional and public consultation," the center's statement charged, adding that cuts made due to temporary economic constraints are taking on a permanent character. The ability of government social spending and welfare to reduce economic inequalities has also been reduced significantly, buoying only 40% of Israel's poor families above the poverty line in 2004, against 48% in 2001.

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