Mapped out: welfare nonprofits in Israel
Author: Taub Center Staff Bulletin Articles

Civil society organizations (nonprofits) provide a broad range of social services to a variety of target populations, yet, to date, there has been a lack of data on the scope of their activities and funding

Civil society organizations (nonprofits) play a major and growing role in the provision of welfare services in Israel. Organizations active in the welfare field constituted 15% of all the civil society organizations registered in Israel, and the sum spent on their annual activity is approximately NIS 14 billion. These organizations provide a broad range of social services to a variety of target populations, yet, to date, there has been a lack of data on the scope of their activities and funding.

In response to the need for comprehensive data, Taub Center researchers Prof. John Gal and Shavit Madhala, along with Dr. Michal Almog-Bar from the Center for the Study of Civil Society and Philanthropy at the Hebrew University, conducted an analysis of active organizations working in the field of welfare between the years of 2013 and 2016 whose annual revenues exceeded NIS 500,000 – a total of 748 organizations.

The study maps out various characteristics of civil society organizations working in the field of welfare in Israel as well as their level and sources of revenue.

What do we know about these organizations and who they serve?

A little under a quarter of the civil society organizations examined in the study serve the general population, while the majority of the remaining organizations serve youth, the elderly, and people with disabilities.

Some organizations provide services intended for particular sectors within Israeli society. 23% of the organizations in the study are intended for the Haredi sector (Haredim make up about 12% of Israel’s population), while 7% have services designated for the Arab Israeli population (which constitutes about 21% of the total population).

 

Welfare EN

The study also finds that about one-fifth of the nonprofits examined are national organizations, operating in five or more locations throughout Israel, and a similar percentage of the total organizations are new – that is, they have been operating for under 15 years. Among organizations serving the Arab Israeli and Haredi populations, specifically, the share of new organizations is even higher.

In addition, among the Arab Israeli organizations, there is a relatively low share of organizations classified as large – with annual revenues exceeding NIS 10 million.

Where is the money coming from and where is it going to?

The total revenue of the welfare nonprofit organizations examined in the study amounts to NIS 13.8 billion a year. The main source of this revenue is through the sale of services (39%), followed by government funding (34%) and donations and bequests (25%).

Out of the total revenue, 23% goes to organizations working with children and youth, and a similar percentage goes to those focused on the elderly, and to those addressing the general population. When examining revenue by sector served, the study finds that only 2% of the total revenue goes to Arab Israeli organizations, while 20% goes to the Haredi organizations.

A notably high percentage of revenue going to Arab Israeli organizations comes from government funding, while, among Haredi organizations, revenue from donations is prominent.

The researchers found that funding disproportionately goes to the organizations with more resources. The vast majority of the government funding that goes to welfare nonprofits (85%) goes to organizations with an annual revenue of over NIS 10 million (including government allocations). Similarly, about half of the philanthropic donations go to the organizations with the highest revenues (in the top 10%), and only 2% of donations go to Arab Israeli organizations.

 

Organization size EN2

What do these data tell us?

Mapping out Israel’s welfare nonprofits sheds light on the disparities that exist among them. The study finds substantial gaps between older and newer organizations, between large and small organizations, and between organizations active in Jewish society and those active in Arab Israeli society. For example, the largest and most veteran organizations receive most of the governmental and philanthropic funding that is available.

Moreover, the shortage of organizations serving the Arab Israeli society and the sector’s limited share of resources, limit Arab Israeli citizens’ access to the social services provided by nonprofits, despite the sector’s many welfare needs. These findings indicate a need to strengthen the civil society organizations in the Arab Israeli sector so as not to further increase the existing social gaps between Jewish and Arab Israelis.