The instinctive association between child allowance payments and the haredi political parties stems from the fact that the haredim have always led the struggle to increase (or at least preserve) the payments. The association also comes from deliberate attempts to etch the notion that the haredim are the only beneficiaries of the child payments, or at least that they are the primary beneficiaries, in the public consciousness. These deliberate attempts have been led by parties seeking to reduce the public discourse to "secular versus haredi," parties such as Shinui in the past, or Yesh Atid today, alongside Ministry of Finance figures who saw in this an opportunity to reduce the heavy cost of welfare payments for the National Insurance Institute (Bituah Leumi).
But these political attempts do not stand up to reality: according to National Insurance Institute figures, 82% of child payment beneficiaries are families with only three children. In fact, families with 5 children account for only 4% of beneficiaries, families with 6 children account for 2.1%, and families with 7 or more account for just 2.3% of beneficiaries. In other words, whoever sought to paint a picture of "us and them," ignored the fact the child payments are primarily for "us" - all of us.
In fact, child payments in Israel are low relative to most developed countries, and primarily relative to Western European countries, and this was before the reduction made by the Netanyahu-Lapid government. In most countries, as was customary also in Israel until Lapid’s tenure as Minister of Finance, the payments increased proportionally to the number of children in a family. In some countries, like France, the payment increases in teenage years. Here are some figures: while the payment in Israel currently stands at NIS 140 per child, which is equal to €32 (before Lapid’s initiative, the payment was €46); the payment in France ranges between €113 and €170; in Ireland, the payment is €166; in Germany €164; in Austria, €105 at least; in Finland €100 at least; and in Sweden €98 (compared with €105-210 in the past).
At this point, we should mention that the birth rate in Europe is much lower than Israel’s, so child payments are high in some European countries in order to encourage birth rates. But there is another point worthy of mention, which counterbalances the previous one: by international standards, child payments in Israel are low relative to GDP - in other words, child payments in Israel are low, period. According to the National Insurance Institute, the same is true for senior payments, disability payments, unemployment, and income support. As a rule, and this puts things into perspective somewhat, child payments constitute just 11% of total National Insurance grants.
A survey conducted by National Insurance Institute deputy director-general for research and planning Dr. Daniel Gottlieb reveals that 37% of all National Insurance Institute payments are for senior and survivor payments; 19% for general disability, 8% for single parents; 8% for nursing and other payments; 7% for victims of crime; 4% for unemployment; 4% for income support; and 2% for IDF reservists. Dr. Gottlieb explains that the child payments, like the senior payments, are universal - they serve as "A basic, social-safety net for everyone, regardless of income or employment ability." Gottlieb added, "The reduction in the weight of the grants relative to GDP is particularly dramatic for universal payments, which are an important tool to reduce inequality and poverty in society, for which Israel leads developed countries - in the negative sense."
The people calling upon Prime Minister Benjamin Netanyahu "not to give in to the haredim" claim that the sharp cut in child payments that Netanyahu led as Minister of Finance in 2003 is what halted the increase in poverty and brought more haredim into the workforce. In reality, National Insurance Institute and Bank of Israel research indicates a marginal decline in birth rates since the cuts, and a moderate rise in workforce participation among haredi men and Arab women, but, in the same breath, researchers noted that these findings cannot be attributed to the cut in payments - rather, it is highly likely that these developments are a product of the trend of increased education, social processes that increased the legitimacy of having two-earner households, the construction of daycare centers, and more.
In general, unlike the situation in 2003, when the child payment from the fourth child on was more than NIS 500, and certainly constituted a benefit for haredim and a negative incentive to joining the workforce, the benefit structure was not like this in 2012, which is what the haredim are currently trying to bring back. In the 2012 structure, the benefit for the first child is NIS 175 per month, goes up to NIS 265 for the fourth child, and returns to NIS 175 for the fifth child. These amounts are very low by international standards, and they are not sufficient to present a negative incentive. The cut led by Lapid, however, unlike the cut led by Netanyahu in 2003, harmed all families and did not offer any sort of positive incentive, whatsoever.
And this is perhaps the most important message that needs to be heard: integrating haredi men and Arab women into the workforce requires much less stick, and much more carrot. This means enriching the core curriculum through economic incentives and effective enforcement, constructing and subsidizing daycare centers in the relevant demographic areas, improving transportation infrastructures and workplace accessibility, increased incentives for employers who hire haredi and minority workers, and encouraging special educational programs and professional training at higher-education institutions. It is quite likely that Yair Lapid also know that this is the key to real change, but it’s also safe to assume that increasing the payments will nonetheless be presented by him as an act of corruption that simply cannot be done. The facts, even in the new politics, are less important.
Published by Globes [online], Israel business news - www.globes-online.com - on April 1, 2015
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