‘More than one-quarter of Israelis poor or nearly poor’ - Report

While Israel's technological and scientific breakthroughs are impressive, it is still has the highest rate of poverty of any OECD country, according to a National Insurance Institute report.

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March 14, 2019 00:50
2 minute read.
Poverty Israel

A man in Jerusalem searching through the garbage. (photo credit: MARC ISRAEL SELLEM/THE JERUSALEM POST)

 
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While much public and governmental attention is given to those living below the poverty line, much less consideration is granted to those living just above the threshold.
 
Israel has the highest rate of poverty of any OECD country, according to a National Insurance Institute report published in December 2018, with the poverty line defined as half of the median disposable income, weighted by household size.
 
A study published Wednesday by nonpartisan policy analysis institute Adva Center, however, has revealed that the situation of those living in “near poverty” – those whose income lies between the poverty line and 25% above it – is not much better.
 
The notion of “near poverty,” developed by American economist and statistician Mollie Orshansky in the 1960s, is also the focus of an annual report by the US Census Bureau.
 
The study, funded by the National Insurance Institute and MAZON: A Jewish Response to Hunger, states that the 2016 poverty rate among Israeli households stood at 18.5%, and the rate of near poverty was a further 8.1%. Together, 26.6% of all Israeli households were either poor or nearly poor.
 
Among Israel’s Arab population, 49.2% of households were below the poverty line, and a further 13.5% in near poverty. Among the Jewish population, 13.2% of families were in poverty and a further 7.2% in near poverty.
 
The group with the highest poverty rate among the Jewish population was Ethiopian immigrants (22.8%). The community with the highest near-poverty rate, however, was post-1990 immigrants from the former Soviet Union (12.1%).
 
At the other end of the spectrum, second-generation Ashkenazi Jews recorded the lowest rate of households living in near poverty (4.4%).
 
The report also examined the expenditure of households living in near poverty on health and educational services. The findings show that their overall expenditure was closer to that of households below the poverty line than to those in the lower middle class.
 
Among Jewish households near poverty, expenditure on supplementary healthcare insurance falls between those in poverty and those in the lower middle class. In the case of formal education, however, expenditure is more similar to those under the poverty line.
 
In the case of the Arab population near poverty, expenditure on both supplementary healthcare insurance and formal education is in line with those below the poverty line.
 
The findings were different in the case of nonbasic expenses of health insurance provided by private insurance companies and informal education.
 
Among Jewish households near poverty, expenditure on private healthcare insurance falls between those in poverty and those in the lower middle class. In the case of informal education, expenditure is similar to those under the poverty line.
 
For Arab households in near poverty, expenditure on private insurance was similar to those under the poverty line, but expenditure on informal education was closer to lower middle class households.
 
“We found that the distance between those that are not poor but are near the poverty line is very small,” Dr. Shlomo Swirski, academic director of the Adva Center and author of the report, told The Jerusalem Post.
 
“We focused on two services, education and health, which should be fully equal by law. Due to several factors, the main one being privatization, people who cannot afford certain services are not capable of receiving the same service,” Swirski said.
 
“We think proper state funding should be able to solve that. We recommend that the state takes it upon itself to fund both informal education and the full needs of the health basket, so that money doesn’t count for such basic services.”

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