Yisrael Beytenu warns against dropping periphery grants

Uri Ariel says government decisions harming housing market, encourages MKs to work to reverse them.

June 19, 2013 17:41
2 minute read.
House in Ashkelon

House in Ashkelon 521. (photo credit: Uriel Messa)


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Coalition and opposition members spoke out against an article in the budget canceling grants for housing in the periphery, in a meeting of the Knesset Control Committee Wednesday.

The 2013-2014 budget cancels grants of up to NIS 100,000 to those buying homes outside of the Center of the country, as the Finance Ministry determined that the stipends did not successfully encourage people to move to the periphery.

“Grants can have a negative effect on the housing market and lead to price increases,” Finance Ministry representative Ariel Yotzer said, defending the policy.

“If our goal is to encourage people to move to the periphery, we have to check how much new construction there was in those areas.”

According to Yotzer, there was a drop in new construction, and that those who already planned to move to the periphery received the grants.

According to MK Orly Levy- Abecassis (Likud Beytenu), Yisrael Beytenu will not support the budget if the grant is not brought back.

“The Finance Ministry contradicts itself. If it wants to cancel the grant because it isn’t used, then where are the savings? If it wants to save an expense, then that proves the grant led people to buy homes in the periphery,” she said.

Construction and Housing Minister Uri Ariel admitted that some government decisions do not help the housing market.

“We need massive numbers of homes sold throughout the country, and everyone’s pressure can help,” he told the MKs. “The battle to lower housing prices is everyone’s battle.”

Housing Ministry director-general Shlomo Ben-Eliahu added that the Finance Ministry decided to cancel the grant on its own, without discussing the matter with the Housing Ministry.

Knesset Control Committee chairman Amnon Cohen (Shas) warned that lawsuits by citizens who were promised the grants and did not receive them will cost the government much more.

“The purpose of the plan is to encourage people to move to the periphery in order to strengthen our economy and society and lower housing prices,” Cohen said.

According to the Shas MK, the Finance Ministry did not like the idea of housing grants to begin with, and saw the new government as an opportunity to cancel them.

Cohen also called for MKs present to “form a united front, without coalition or opposition,” to make sure the grants are not canceled.

“After all the speeches and promises by the government, they cut off the flow of blood to the periphery,” said MK Itzik Shmuli (Labor), who submitted the motion to the agenda leading to the Control Committee meeting.

Shmuli added: “NIS 60,000 is 10 percent of the value of an apartment in these areas, and the minimum the government must give its citizens is an extension of a year to allow those who started to buy homes because of the promised grant to finish the process.”

MK Yisrael Eichler (United Torah Judaism) claimed that the grants led to a 71% increase in construction in the periphery, and that their cancellation will harm haredim and young non-haredi couples looking for cheaper housing.

“There seems to be a trend of harming haredim – cutting daycares subsidies, free dental care and housing grants – even if the rest of the population is harmed on the way,” MK Orit Struck (Bayit Yehudi) said.

MK Shimon Ohayon (Likud Beytenu) expressed outrage that the South, which is often attacked by rockets from Gaza, is being treated poorly by the government.

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