After four years in which the level of poverty remained
steady, the number of poor people rose to 1.32 million, or
18.1 percent of the population. The number of poor families
in Israel last year grew by more than five percent to 18.5
percent of all the families in the country. The total number
of poor families is now 340,000.
The National Insurance Institute (NII -- Bituach Leumi)
published the figures on Monday as part of a survey of the
effects of the five economic programs approved by the Knesset
in the years 2002 and 2003. The figures are still estimates,
as exact figures for 2003 will be available only in six
months.
NII figures indicated 1,212,000 (20 percent) poor people in
2002. In 2001, 17.7 percent of the population was poor, about
the same as in the previous four years.
The poverty line is defined as half of the median income. The
median income is the level at which half earn more and half
earn less. For a single person it is currently NIS 1,743
($383 a month). For a couple it is NIS 2,789 ($613).
The poorest large city is Jerusalem with 22.2 percent of its
families and 38.8 percent of its children living below the
poverty line. In Bnei Brak, 31 percent of its families lived
in poverty and 50.6 percent of its children. The chareidi
population would certainly like to have more money, but no
one thinks that its poverty will cause riots or social
unrest.
The sudden growth in the number of poor families is
attributed to various factors, especially the NIS 5.5 billion
cut in NII budgets in the past two years which brought their
real value down by an average of 7.2 percent.
According to the figures in the survey, old age payments lost
10 percent of their buying power in the past two years and
the guaranteed income allowance went down by some 20 percent.
The single family allowance dropped by 28 percent and child
allowances for families with two children dropped by 20
percent, on average.
The stiffening of criteria for unemployment benefits led to a
sharp decrease so that the number of unemployed receiving
assistance stood at 23 percent in 2003 compared to 39 percent
in 2001.
Dr. Yigal Ben-Shalom, head of the NII, noted that contrary to
social policy in the previous 30 years -- when the allowances
were linked to the average wage so that recipients could
enjoy the same improvements as the rest of the population --
starting in 2006 they are due to be linked only to price
rises. He said that this will lead to even greater poverty
since the rest of the population will enjoy larger incomes,
while those getting allowances will remain in the same
place.
Ben-Shalom also believes the current signs of improvement in
the economy will not be felt in coming years in the lowest
income groups. The survey reveals that most of the burden of
the economic recovery in the past two years was borne by the
low income groups.
While the standard of living of the general population
dropped by 4.6 percent, on average, that of the lowest decile
dropped 12 percent and the second lowest decile by 7 percent.
As a result, poor families got even poorer. Their average
income was 30 percent or more below the poverty line in
2003.
Around a third of those over 65 live in poverty: about
210,000 out of 640,000.
The NII said that of 29 developed countries, Israel ranks
19th in the level of its public support per person in
relation to its GDP per capita. It pointed out that even if
the economy improves this year and next, those receiving
handouts will not benefit since the payment levels are frozen
until 2006.
