NII poverty report unlikely to reflect global crisis

Economic experts are predicting that the global recession is already having an impact here.

By RUTH EGLASH
poverty biz 88 298 (photo credit: Ariel Jerozolimski)
poverty biz 88 298
(photo credit: Ariel Jerozolimski)
The National Insurance Institute's (NII) annual poverty report, which is set to be released Sunday, is unlikely to reflect current market trends and the global recession that could hit Israel in the coming months, according to a source that has already viewed the report's data. The poverty figures contained in the report - which are based on NII information from 2007 - do not present any dramatic changes over the previous number of years, the source told The Jerusalem Post on Saturday, adding that the number of people below the poverty line will remain comparable to last year's report. Released last in April 2007, the NII's previous annual poverty report, which was based on 2006 figures, showed that close to 1.65 million in Israel lived below the poverty line. In 2005 that figure stood at 1.63 million. In fact, the last report even noted an overall decrease in the number of poor families, with a drop from 410,700 or 20.6 percent of the population in 2005, to 404,400 or 20% in 2006, and in the elderly population, where poverty fell from 24.4% in 2005 to 21.5% in 2006. Since that last report there have been some efforts by the government to battle the country's poverty problems, including the implementation of a negative income tax program for low-income families and changes to the welfare-to-work program called Lights to Employment. While Sunday's report is unlikely to push Israel's poverty rates up much higher than last year, economic experts are predicting that the global recession is already having an impact here. Recent statistics released last month by the National Employment Service show a slight increase of 0.8 percentage points in the number of people unemployed during the past four months, and the Central Bureau of Statistics recently reported that the country's unemployment rate had stood still in September at 5.9% - an indication that economic benefits enjoyed over the past five years could soon come to an end. Also, in the past few weeks, several large companies have already announced some large-scale layoffs and forced early retirements for employees. In an interview with the Post earlier this month, NII Director-General Esther Dominissini expressed concern that those who are currently in the lower socio-economic bracket could soon find themselves falling onto hard times due to the current crisis. "I worry about those who live just above the poverty line," she said. "They have never been poor and don't know how to deal with that status day-to-day. If they lose their jobs they could end up in a very difficult situation." According to Dominissini, however, the institute has some NIS 128 billion in reserve set aside to support those who could end up unemployed in the near future. "Our job is to make sure that this reserve is always there so that the citizens of Israel are assured they will be cared for during times of need," she said in the interview.