Budget deal is 'major breakthrough' on social issues, Herzog says

Describing it as a "major breakthrough," Welfare and Social Services Minister Isaac Herzog Monday welcomed the agreement reached between coalition factions on the 2008 budget and its accompanying Economic Arrangements Bill. "We are very pleased," Herzog told The Jerusalem Post following a morning of intense negotiations focused on several social welfare and health-related issues, including plans to freeze government-issued benefits, reduce medicines included in the health basket and even a suggested health tax on housewives. "We thought such moves were extremely unjustified." On Sunday night, Labor, Gil and Shas parties had all threatened to withdraw their support for the budget and the bill unless certain amendments that they deemed harmful to the country's weaker populations were removed. Herzog said the reformed budget, together with several steps taken by the government in recent months, would hopefully promote economic growth among segments of society that have been languishing. Among those changes, he said, are the implementation of a negative income tax policy, new agreements between workers unions and the treasury, as well as forthcoming plans to increase the minimum wage. Herzog said he hoped the economic growth of recent years would "trickle downwards." Meanwhile, Herzog was presented Monday with the The Taub Center for Social Policy Studies' Social Services Report 2007, during a special ceremony at President Shimon Peres's residence. The annual report, which hopes to urge policymakers to focus on the deep-rooted socio-economic difficulties when drafting the budget, noted that while there has been a significant improvement in Israel's economic situation on a macro level, prosperity has not yet filtered down to many families. "This situation means that there needs to be more development in the area of social welfare so that those families can utilize the services," states the report, which was researched by the center's director Prof. Ya'akov Kopp and a team of experts. "The best policy to deal with this situation is through prevention." Speaking to the Post prior to his meeting with Herzog and Peres, Kopp said that the report's recommendations for improved social services was not just about increasing budgets but also about encouraging the government to change its policies towards health, education and social welfare. In addition, Kopp said he was encouraged this year by the appointment of Herzog to the position of minister of Welfare and Social Services, as compared to last year when a minister had not yet taken over. "Herzog not only changed the name of the ministry but he has also changed the picture of social welfare and is deeply committed to these issues," said Kopp, highlighting recent steps made by the minister to increase Holocaust survivor benefits. "We really feel now that there is someone in charge of the social welfare sphere," he continued. "However, at the same time, the ministry still does not receive the resources it needs to cope with all the problems that have built up over the past few years." As for the makeup of the 2008 budget, Kopp said it is still too early to determine if some of the policies will severely damage or improve life for those weaker populations. "We can never trust such a document," he said. "What is written and what happens by the end of the year is not always one and the same. Usually we see a surplus of money designated for social projects that is not always utilized." While in the past, the Taub center's report is unveiled directly to the policymakers in the Knesset, Kopp explained that this year's change of venue was potent given the recently appointed president's experience in affording social change. "He is not constitutionally in charge, but he has a lot of influence," Kopp said of Peres, who was sworn in as president in July. In the 1980s, during his term as prime minister, Peres was involved in establishing an economic stabilization program. The Taub Center for Social Policy Studies in Israel is an independent, non-profit and non-partisan research institute, established to address social policy issues that challenge society. Agreement has also been reached among representatives from the Treasury, the Ministry of Culture and the Cultural Forum to restore next year's budget for culture to NS 445 million and to rescind any projected cuts. "This is not a signed document," said Cultural Forum head Itamar Gurevitch, "but I want to believe that those concerned will honor the agreement." Gurevitch believes that last week's demonstration against the proposed cuts, as well as the threatened boycott of the country's 60th anniversary celebrations, helped influence the officials' decisions, but "the major factor is the Forum's determined resoluteness." The Cultural Forum represents all of Israel's cultural institutions, some 150 bodies from the performing arts to the museums, and it is the first time that all have banded together. Government secretary Oved Yehezkel telephoned to say that Prime Minister Ehud Olmert was informed and approves of the agreement. Helen Kaye contributed to this report.