Finance chair: Gov't financial plan a 'collection of unclear headlines'

Dismissing that the Knesset committee will act as a "rubber stamp," MK Oded Forer said the plan must include compensation for severely affected industries, including the tourism industry.

MK Oded Forer (photo credit: JEREMY JEFFER)
MK Oded Forer
(photo credit: JEREMY JEFFER)
The temporary chairman of the Knesset Finance Committee, Yisrael Beytenu MK Oded Forer, attacked on Tuesday the NIS 80 billion financial aid plan presented by the government, describing it as a "collection of unclear headlines" and threatening to vote down certain measures unless modified.
"Yesterday, some sort of program was published, but it is unfortunately very similar to everything that we have already seen – a collection of unclear headlines, which produce nothing for business owners," Forer told the committee.
"Nobody knows what he is eligible [to receive] and what he will be owed tomorrow. Again, discrimination between salaried employees and self-employed workers is clear, both in terms of financial sums and age."
Dismissing the idea that the committee will act as a "rubber stamp," Forer said the plan must include compensation for severely affected industries, including the tourism industry.
"Building an airline from scratch will cost a lot more than keeping existing ones alive, by providing them with a necessary credit limit," Forer said, referring to struggling Israeli carriers, including El Al.
He also cast doubt on the ability of the government to provide the first assistance payments to struggling businesses and workers before next week's Passover holiday, as promised by the Financial Ministry.
The government published its major economic plan on Monday to soften the blow of the coronavirus outbreak, promising NIS 80 billion in financial aid for the healthcare system, struggling businesses, salaried employees and self-employed workers.
The publication of the program was significantly delayed, with Prime MInister Benjamin Netanyahu promising on March 22 that details would be provided within 48 hours.
The financial aid package, amounting to approximately 6% of Israel's gross domestic product, involves commitments of NIS 70b. in funds, in addition to NIS 10b. of financial assistance already promised in recent weeks.
The package includes funds for the healthcare system and assisting at-risk population groups; a "social security safety net" for salaried employees, self-employed workers and the elderly; support for businesses harmed by the outbreak; and a program for the acceleration of the economy and stimulus for critical growth engines.
"I am aware that [the financial package] won't return the situation to what it was prior to the crisis – not for businesses, employees or the self-employed," said outgoing Finance Minister Moshe Kahlon. "But we are speaking about the most significant program that the Israeli economy has ever known. I have no doubt that if this crisis will continue, we will need additions. We will not allow the Israeli economy to collapse."
More than 831,000 newly unemployed workers applied for benefits during March, the Employment Service said on Tuesday, bringing the total number to almost 989,000 or 23.8% of the workforce. Prior to the crisis, unemployment stood at just 4%.
Among those applying for assistance in March, 89.7% are employees placed on unpaid leave, and a further 6.4% have been made redundant. While the share of male and female applicants was almost equal prior to the crisis, 57.7% of new applicants are women.
Primarily affected groups include unskilled workers (15.5% of new applicants), education workers (13.9%), sales employees (9.4%) and hospitality staff (6.4%), Employment Service data showed. Almost half (45.6%) of new applicants are aged 20-34, a further 37.3% are 35-54, and 14.6% are 55 and over. Only 2.5% of applicants are under 20 years old, likely due to mandatory service.
According to estimates published by the National Insurance Institute (Bituach Leumi), the number of unemployed workers will reach 1.1 million during April and May. The institute expects to pay an additional NIS 6.5 billion in unemployment benefits in June.
Additional forecasts include a deterioration in the financial stability of the institute during May and June, culminating in a deficit of some NIS 8.1b. In an "optimistic scenario," in which unemployment benefits decrease significantly by September, the deficit is likely to fall to approximately NIS 319m. In a "pessimistic scenario," however, the deficit will only decrease to NIS 1.9b. by December.