The official report on Israel's state poverty released by the National Insurance highlights the return of the Israeli economy to the path of growth in comparison with the Coronavirus crisis. While in 2020 GDP declined by 1.9%, in 2021 it grew by 8.3% - which is the highest growth rate recorded compared to other developed countries. The unemployment rate has fallen significantly and there has been an increase in real wages.
The assistance offered to the Israeli population during the Coronavirus has highlighted the great importance of social security systems adapted to the needs of the public. With the cancellation of the restrictions characteristic of the Coronavirus period, aid to families and businesses has been significantly reduced and the impact on different population groups has not been uniform, and as a result, for the first time in years, rates of poverty and inequality in terms of net income have increased.
- In 2021, the poverty line is around NIS 2,849 for an individual, and NIS 5,698 for a couple. A couple with 2 children will be considered poor below NIS 9,117, and below NIS 12,108 for a couple with 4 children. This year in Israel, there are nearly 1.95 million poor people, among them - 853.9 thousand poor children representing 28% of the population, and 212.4 poor pensioners - who make up nearly 17.6% of the Israeli population. The depth of poverty (to assess the severity of poverty) increased from 38.7% in 2020 to 39.4% in 2021. The poverty dimension increased in families from 20.6% to 21%, in individuals from 20.5% to 21%, and in children from 27.2% to 28%.
- In the absence of government intervention, i.e. on the basis of economic income, the poverty dimension of families decreased from 37.4% to 35.5%, from 33.9% to 32.1% among individuals, and from 39% to 37% among children. The highest increase in the (net) poverty dimension was recorded among older people, from 16.4% in 2020 to 17.6% in 2021, following the cessation of special subsidies distributed in 2020, on the one hand, and due to their low participation in the labor market and their difficulty in returning to it, on the other hand. The poverty dimension of working families remained almost unchanged and reflects conflicting trends between employed and self-employed workers: the poverty dimension of employees increased slightly while that of self-employed families decreased from 13.4% to 12.1% between the two years.
- In 2021, the allowance offered to the elderly is the highest in terms of effectiveness in reducing poverty, followed by the survivors allowance. The income support benefit, which has not changed for many years, is one of the benefits with a low degree of contribution to escaping poverty.
- The results of poverty according to geographical distribution show that the poverty indices in the districts of Jerusalem, North and South are higher than the average. By comparison, in Tel Aviv and Central districts, rates are below average. For example: in the district of Jerusalem: the poverty dimension of families amounts to 38.7%, individuals to 42%, children to 51.2%. In the Tel Aviv district, the poverty dimension of families stands at 15.7%, individuals at 15.1% and children at 20.2%.
- The rate of poor people among the self-employed is 15.2% while among the employed it is 16.5%. The poverty rate among families with children is 24.2% and among single-parent families 24.9%. In the Haredi population this rate reaches 39.7%, among the elderly 16.8%, and among the Arabs 38.8%.
- The Gini index of net income inequality rose by 0.8%, but declined by 1.4% according to economic income.
- It was also found, based on a social survey by the Central Bureau of Statistics, that more than 26% of households reported not being able to cover all their monthly expenses, 10.6% gave up medical care, 6.9% on prescription drugs, and 5.2% on a hot meal due to economic hardship. Regarding the indices of subjective poverty, based on preliminary results of a survey conducted by the National Insurance, it appears that 30.6% of women reported feeling poverty while for men, the rate is 27.4%. Women aged 35 to 67 years who consider themselves poor reach 32.6%, while this rate is about 25.7% among young people up to 35 years who reported subjective poverty. The report shows that the impression of subjective poverty has increased, compared to previous years, among the majority of population groups and that they show substantial deprivation in their lives.
- Also on an international comparison, while in 2020 we could see that the social assistance model offered during the Coronavirus placed Israel close to the average of OECD countries, in 2021 the country fell back to the bottom of the ranking, which reflects a level of poverty among the highest in developed countries (penultimate above Costa Rica). The National Insurance recommends increasing the benefits that serve as a last safety net for families with low incomes or families who have fallen into temporary economic distress: minimum subsistence income, old-age pension and unemployment benefits, as well as the promotion of tools and assistance to families in the labor market who are still living in poverty. Similarly, emphasis must be placed on social gaps between the periphery and the center - an aspect that is expressed in terms of low wages and immense social difficulty.
Minister of Social Affairs and Social Security, Knesset member Yaakov Mergui: "There are many populations in Israel, especially in the periphery, who need tools to deal with poverty and inequality in Israeli society. The Poverty Report shows once again that benefits help lift people out of poverty. I have been in my post as Minister of Social Affairs for a few days now and this report represents a major tool in my eyes for the promotion of social policies in which I believe. The National Insurance publishes a report on poverty and, to my regret, there are no significant changes in poverty indices and therefore, during the upcoming term, I will make every effort to address the causes of poverty and facilitate access to the labor market, along with an adequate and up-to-date distributive justice."
Minister at the Ministry of Social Affairs, Yoav Ben Tsur: "The vulnerable populations in society are close to my heart, and that is why we came to this Ministry. We feel a public responsibility to reduce inequality in Israel and that is our mission. We refuse to accept a reality in which elderly people, children and families live in poverty. It is a deplorable thing that an organized and value-bearing society cannot accept. There are many ways to ensure an end to poverty towards a respectable and prideful life. Diverse employment opportunities tailored to populations in need of assistance are a current element that will be developed during this term, in order to escape the circle of poverty and we are currently working on a new program for all citizens of Israel."
Acting Director General of National Insurance, Yarona Shalom: "The State of Israel has lagged far behind OECD countries in poverty and inequality for years. It is impossible for the amount of some benefits to fall below the poverty line, which amounts to only 2,849 shekels. In order to address disparities in society, there is a need to increase benefits, to provide tools and support to families and individuals who are in the labor market but whose wages are low, with a focus on the periphery. Changes to the law are needed that will relax eligibility conditions for benefits, provide education and specialization, which will certainly lead to an increase in wages and help lift people out of poverty. And all this, without the beneficiaries fearing losing their allowance or ancillary benefits, because this situation would prevent any evolution."