At a Likud meeting Monday night Finance Minister Binyamin
Netanyahu said he plans to present his economic plan as early
as next week. In the initial phase NIS 10 billion ($2
billion) in government expenses will be slashed, followed by
another NIS 10-billion cut in the second phase. Experts say
Netanyahu intends to curtail Children's Allowances and to
totally repeal the Large Families Law.
At a Knesset plenum on Monday, Rabbi Avrohom Ravitz of UTJ
expressed the criticism that the chareidi community has for
the Likud and its treatment of UTJ in forming the
government.
Political figures note Prime Minister Ariel Sharon and
Netanyahu face heavy pressure from Justice Minister Yosef
Lapid, who says he made a pledge to his voters that he would
strike a blow at government funds allocated to chareidim
("The chareidi public lives off of its children," he said
during the campaign).
In coalition negotiations with Shinui, National Religious
Party (NRP) representatives said they had no objections to
cutting children's allowances and a bill recently proposed by
MK Shaul Yahalom indicates the party does have any
reservations regarding such a move.
Since it is well-known that chareidim have large families,
the funding through Bituach Leumi for children, known as
"children's allowances" (kitzvat yeladim), is widely
perceived to be an issue of mainly chareidi interest. Though
the average size of all religious families is larger than the
average size of secular families, most followers of the NRP
do not have such large families. In addition to religious
Jews, Israeli Arabs also benefit from the Bituach Leumi
payments for children. They do not serve in the IDF.
According to Bituach Leumi calculations, a further cut in
Children's Allowances would bring tens of thousands of
families--primarily in the chareidi and Arab sectors--below
the poverty line. At Monday's meeting Netanyahu said he would
submit a proposal for a 15 percent salary cut for government
director-generals as well as salary reductions for their
staffs.
The defense establishment has insisted for months that it
needs an extra NIS 5-6 billion this year. The treasury, in
contrast, says that the higher-than-expected budget deficit
in January and February necessitates a NIS 1-1.5 billion cut
in defense spending. Yesterday, Sharon said that the economic
crisis necessitates some reduction in the defense budget, yet
the ongoing terrorism precludes the kind of cuts the treasury
is demanding. Treasury officials interpreted this as meaning
that Sharon wants to give the defense establishment part of
the NIS 5 billion increase it is demanding.
According to a report in Yediot Achronot by Amnon
Ated, Finance Ministry officials appear to have declared war
on recipients of Children's Allowances. Finance Ministry
moves, which began during Silvan Shalom's term as Minister,
point to a "genuine obsession toward a single goal,"
according to Ated.
The report reviewed cuts in Children's Allowances over the
last three years. At the beginning of 2002, Children's
Allowances were cut by 12 percent following a 4 percent cut
in the majority of other Bituach Leumi allowances. In July
another cut in Children's Allowances took effect. Recipients
who had served in the military absorbed a 4 percent cut,
while those who had never served (primarily chareidim and
Arabs) were to suffer a 24 percent reduction.
This last cut has been delayed in the High Court by a suit
filed by Arabs. The government is trying to explain to the
court why children whose parents did not serve in the IDF are
being discriminated against. If the High Court decides not to
allow this cut the Finance Ministry will convert it into a
graded 11 percent cut. Guaranteed Minimum Income
(Havtachat Hachnasa) has also been cut by an average
rate of 30 percent.
Bituach Leumi heads say the Finance Ministry has effectively
turned Bituach Leumi into an instrument for raising taxes on
certain sectors and the primary victims are the chareidim,
the majority of whom are already under the poverty line.
Ated demonstrates that the partial cut in Children's
Allowances without the military service clause has already
saved the state a total of NIS 600 million during the first
nine months of the previous fiscal year, and not updating
Children's Allowances this year would prevent another NIS 700
million from reaching recipients' pockets.
Economic analysts have expressed surprise that, as the
principle victim, the chareidi sector has not launched an all-
out battle against the Finance Ministry since past experience
shows only a public campaign can halt the war the Ministry
proclaimed against the nation's lower classes.
Meanwhile Histadrut heads have been curiously silent with
respect to tens of thousands of workers who paid National
Insurance dues as required yet their allowances are being
cut. Economists are asking why payments to Bituach Leumi are
not being reduced proportionately. Bituach Leumi payments are
a regressive tax since they are levied on everyone at the
same rate.
Dr. Shlomo Swirsky, head of the Adva Center, explains that
the payments for children's allowances do not come from the
State, but from an insurance arrangement financed by workers
and their employers. Therefore he argues that allowances
should not be considered a handout. Bituach Leumi is not
doing anybody a favor, he says, since these are public funds
returned to their providers. Bituach Leumi has billions of
shekels in reserve funds lying untouched, but the Finance
Ministry has not allowed them to be used, and even torpedoed
an initiative to provide aid money to soup kitchens for the
hungry around the country.
Dr. Swirsky notes that Children's Allowances originated in
the Ben Shachar Commission in 1975, which proposed granting
tax credits for every child. Later the point system was
converted into payments. One year ago the economic consultant
for the Knesset Finance Committee, Smadar Elchanani, said
that cutting children's allowances was tantamount to raising
taxes unequally by laying the burden on large families.
In a tumultuous Knesset plenum held on Monday to address a no-
confidence motion tabled by United Torah Jewry and Shas last
week to protest drastic alterations in the status quo that
would strike hardest at vulnerable segments of the
population, MK Rabbi Avrohom Ravitz (UTJ) said a "new/old
king" had risen up, and apparently in order to demonstrate
his sovereignty he assumed he must issue decrees.
"This is not the way to set out on a new path, new king,"
said Rabbi Ravitz. Later he listed the parts of the coalition
agreement between Shinui and Mafdal, speaking of the danger
posed by a legislative initiative that has been fought
against for years by religious representatives in the Knesset
-- including the Mafdal -- because it is liable to lead to a
loss of Jewish identity in the State of Israel. He also noted
the agreement to change the law that allows full-time yeshiva
students to receive military deferments, warning that Israel
could become the only country in the world where people who
want to study Torah are not allowed to do so.
"But we are not worried. There is a promise that Torah will
never be forgotten mipi zar'o umipi zera zar'o.
Therefore all who view this as their appointed task and the
purpose of our very existence as a people will continue to
study Torah here. Nothing can change that," he said.
Rabbi Ravitz said the new government ostracizes a million
citizens of the State of Israel who voted for UTJ and Shas.
Addressing Shinui, he said, "You were unable to abandon the
racist slogan that you would not sit down with the chareidim
lest they grow and increase. How much hatred this generates
in Am Yisroel. And you in the NRP did not pass this test."
He expressed the bitterness felt in the chareidi community
towards the Likud and its conduct of negotiations with UTJ.
On the Thursday before the government was set up the various
sides agreed on all of the issues and it was agreed that the
signing of an agreement would be the following Sunday. "And
on Sunday you did not even pick up the phone. To this day we
have yet to receive a call, not even to apologize."
He also lodged criticism against the Likud for lending
support to a slogan that called for the rejection of one
million citizens from the chareidi parties and said he
promises this sector would continue to live and flourish here
"even if it means we will have to live deeper in poverty. We
will be here for the sake of the goal we see as sacred above
all: learning Torah and keeping its mitzvos."
