Yacimovich economic plan pledges increased spending

Platform built on 5 “foundation stones”: Basic services, fairer wages, reduced cost of living, fair competition and fair taxation.

Shelly Yacimovich at Labor Central Committee 370 (photo credit: Marc Israel Sellem/The Jerusalem Post)
Shelly Yacimovich at Labor Central Committee 370
(photo credit: Marc Israel Sellem/The Jerusalem Post)
Labor chairwoman Shelly Yacimovich revealed her party’s economic election platform in Ashdod Monday night, promising to increase public expenditure by collecting more tax revenues from the rich.
“I believe that all Israel’s citizens must benefit from the state’s economic strength, and not just a lucky few,” she said.
“I believe in social democracy, which means a fair economy and just society, and a smart balance between a prosperous, booming, entrepreneurial free market and a government that is accountable for its citizens and allocates state resources responsibly and wisely.”
The platform, which Labor is billing as an alternative to the policies of Prime Minister Binyamin Netanyahu’s government that will strengthen the poor and middle class, was formulated by a team of around 50 professionals.
It is built on five “foundation stones”: basic services, fairer wages for employees, reduced cost of living, fair competition and fair taxation.
Under the heading of basic services, Labor says it will increase expenditure on health, public transport, welfare, local authorities and personal security. It is promising to go one better than the Netanyahu government by offering free education for ages two and over, as well as increased expenditure for elementary schools. Additionally, it is pledging to put an end to the outsourcing of teachers to contract companies.
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Contract workers were the focus of the second foundation stone, with Yacimovich pledging to put an end to the practice of employing them in the public sector. She also committed to increasing the minimum wage and establishing a state-funded system for worker placement and training.
On the topic of the cost of living, the platform proposes building thousands of housing units in high-demand areas and increasing the availability of public housing and assistance.
It also proposes reducing the 17 percent Value Added Tax rate for basic products and strengthening government price supervision of essential foods.
On competition, it promises a number of measures including increased state assistance to small to medium sized enterprises, unemployment insurance for independent business owners and more state expenditure for peripheral regions of the country – including the establishment of nine new industrial zones and incentives to encourage businesses to employ hi-tech engineers.
How will Labor finance this plan? It has committed to meeting next year’s existing budget deficit target of 3%, but says it reserves the right to increase the deficit in the event of a recession. It is promising to increase revenues by raising income tax for all earnings over NIS 50,000 per month, clamping down on “trapped profits” of large corporations, collecting tax from profits on natural resources, introducing a new 5% tax on estate inheritances of at least NIS 15 million, and reversing the Netanyahu government’s cancellation of import duties.