New COVID economic program to distribute new round of grants

"We will soon be the first country in the world to step out of the Corona and open up our economy."

Shop and small business owners protested coronavirus lockdown regulations in Tel Aviv. (photo credit: AVSHALOM SASSONI/ MAARIV)
Shop and small business owners protested coronavirus lockdown regulations in Tel Aviv.
(photo credit: AVSHALOM SASSONI/ MAARIV)
The Finance Ministry unveiled a new economic assistance program Sunday unveiled an economic assistance program that offers household grants to Israeli families once more, along with benefits to businesses and unemployed workers affected by the coronavirus pandemic.
The program provides a new round of household grants of NIS 750 per adult, NIS 500 for each child up to the fourth child and NIS 300 for the fifth child and up.
The plan was presented despite the objections of Attorney-General Avichai Mandelblit, who said announcing such a plan during an election season was inappropriate.
“We will soon be the first country in the world to step out of the coronavirus [situation] and open up our economy,” Prime Minister Benjamin Netanyahu said as he unveiled the plan with Finance Minister Israel Katz. “But now, we have reached a decisive stage, and at this stage, we must do two things: First, continue to give more help to those affected, and second, to propel our economy forward by encouraging business and encouraging consumption. We do not lower the foot on the gas [pedal] even for a moment.”
The announcement of the plan came as a surprise and was greeted with skepticism by Netanyahu’s political rivals.
“Neither the government nor senior finance officials saw the details of the plan, and for one reason – there is none,” tweeted Alternate Prime Minister Benny Gantz as the plan was announced. “It is very sad that Netanyahu is once again making promises that he will not keep and leave hundreds of thousands of Israelis waiting for help.”
In addition to the household grants, Katz included other items in the plan to restore the economy:
• Companies whose revenues dropped 25% or more during the coronavirus closures will receive a grant of up to NIS 30,000, depending on their size and scope of the damage. New businesses that opened in 2020 would be entitled to a NIS 8,000 grant.
• A plan to encourage the return of employees to work. People who were unemployed more than 80 days in a row and return to work for a period of four months would receive a package more than doubling their unemployment benefits.
• A special grant for the disabled totaling NIS 500 million would be set up.
• Small businesses would have the option to spread out VAT payments over six months.
• Businesses would be offered a delay in repayment of loans, and new loans would become available for at-risk businesses.
• Unemployment benefits would be available for self-employed workers who have not been considered eligible for such benefits until now.
• A reduction of regulations stifling business growth would be made, and easier terms for business licensing would be set.
• Reforms that would allow pension and insurance companies to invest in Israeli hi-tech and infrastructure, injecting new funds into the system.
Netanyahu rejected claims that the plan was just election economics, saying it is an essential need.
“Is this an election economy because it helps Israeli citizens?” he asked. “Maybe the Attorney General wants to tell me how many vaccines I can bring? It does not occur to us to harm the health or livelihoods of our citizens because of elections.”
Netanyahu justified the expense of the program by comparing it to US President’s Joe Biden’s $1.9 trillion economic plan, which would cost 8.6% of GDP. That would correspond to NIS 122 billion for Israel, he said. He quoted US Treasury Secretary-designate Janet Yellen as saying when interest rates are at an all-time low and you can borrow a lot of money at a very low price, “the smartest thing we can do is act big.”
Following the presentation, Yamina chairman Naftali Bennett expressed cynicism about the plan.
“While you could do all these beautiful things, you chose not to [set] a budget and prevented everything,” he said. “If the people of Israel could feed their children the promises of this bad government, there would not be thousands of people hungry for bread now.”
Prime-ministerial candidate Gideon Sa’ar, head of the New Hope Party, responded to the announcement by announcing that he has his own five-point plan for economic recovery, with the first goal of reducing unemployment.
The government’s new plan comes on the heels of several other economic plans that have been launched in recent weeks. Earlier this month, the Knesset approved a plan called “From brakes to growth” to provide assistance with special grants and property-tax payments for small businesses and freelancers.