Fischer urges gov't to fight poverty

Warns that Labor initiative to raise minimum wage would damage economy.

Fischer 298.88 (photo credit: Ariel Jerozolimski)
Fischer 298.88
(photo credit: Ariel Jerozolimski)
Bank of Israel Governor Stanley Fischer published his annual financial report on Sunday afternoon, calling on the government to adopt a comprehensive program to fight poverty. Fischer also suggested introducing a mechanism of negative income tax and improving pension funds, and ease criteria for accepting unemployment benefits. In an Army Radio interview he warned that the Labor Party's initiative of raising the minimum wage to $1,000 too quickly would damage the Israeli economy. Fischer said he was not opposed to a gradual increase, but raising it too rapidly would have a "negative impact" on unemployment. "It is dangerous to raise the rate at too rapid a pace," claimed the Bank of Israel governor. After a meeting with Acting Prime Minister Ehud Olmert, Fischer said that he was confident the government would maintain the same policy that Olmert adopted when he was finance minister. "He plans for the government to keep the same framework. I was encouraged by what I heard." Fischer said at a Jerusalem news conference after releasing the central bank's report. According to the report, the last financial year was one of the best for the Israeli economy. Fischer declared that foreign investment was the highest the country had ever known and he called on Israel not to backtrack on its financial achievements.