(9) NII report: Number of poor in Israel climbs to 1.63 million

By Ruth Sinai

Haaretz
30 August 2006

http://www.haaretz.com/hasen/spages/756663.html

The poverty rate in Israel continued to climb in 2005, with another
47,000 Israelis, half of them children, being classed as poor,
according to an annual National Insurance Institute report released
Wednesday.

By the end of 2005, there were 1.63 million people living below the
poverty line in Israel, including 410,000 families and 768,000
children. The overall figure represents roughly a quarter of the
population.

The poverty line is set at a monthly income of NIS 1,866 for an
individual and NIS 4,778 for a family of four.

The report found, however, that the poverty rate among the elderly
has dropped.

The percentage of the elderly living below the poverty line fell
from 25 percent in 2004, to 24.4 percent a year later.

The decrease in the poverty rate among the elderly can be attributed
to the new old-age pensions and the 9-10 percent increase in the
pensions of senior citizens with no other source of income.

The report is the second one to be published by the NII this year.
The first, published in January, reflected poverty during the year
between mid-2004 and mid-2005, while the findings published
Wednesday reflect 2005 in its entirety.

The poverty rate has risen despite the decrease in unemployment

Poverty has risen in spite of the increase in the number of wage
earner and the decrease in unemployment, because real wages rose
mostly among the upper classes and degree-holders. The salaries of
those with no higher education have gone down.

Since 1998 the number of impoverished children has seen a 55 percent
growth, and at the end of 2005 35.2 percent of all children in
Israel lived in poor families. This is due to the continuing drop in
children stipends, which have gone down by 10 percent in 2005 and by
47 percent since 2001.

While tax reforms have decreased the expectations of a significant
increase in poverty levels by raising the income of the upper
classes, the "inequality index" measuring differences in income
distribution between the rich and the poor indicated a rise in
inequality in 2005.

Even though the inequality level in Israel is lower than that in the
U.S., Mexico and Russia, it is higher than the level measured in all
other developed countries.

Former Social Security CEO Yochanan Shtesman said Wednesday that
governments have not done enough in recent years to reduce the
number of poor people and that the stipend cutback has greatly
worsened their situation.

"The tax reform has improved the situation of the upper classes and
further intensified the gaps in society," said Shtesman in an
interview to Israel Radio, and called for the immediate appointment
of a full time minister of welfare.

Attorney Eran Weintraub, who heads the Latet food organization,
warned yesterday that if the 2007 budget will not include a national
plan to combat poverty, the organizations in charge of food and
equipment distribution would have stop their activities. Even today,
he claims, the organizations are unable to answer most of the needs
of the poor.

"The problem of poverty is no lesser a threat to Israeli society
than is the security threat," he said.