It’s been two years since the Elalouf Committee released its recommendations: What’s happening with the War Against Poverty?

PRESS RELEASE: It’s been two years since the Elalouf Committee released its recommendations: What’s happening with the War Against Poverty?

 

A new Taub Center Policy Brief to be presented on December 1st at the Taub Center’s annual conference, which this year will be on the subject of innovations in poverty policy, looks at the implementation of the recommendations of the Committee for the War Against Poverty. It shows that two years after the committee’s final report, only half of the recommendations have been adopted in full or in part. The researchers warn that since a centralized authority for combatting poverty has yet to be established and due to budget constraints (the budget is about one-quarter of what was estimated as necessary by the committee), it will be difficult to reduce poverty rates in any real way.

 

Main findings:

  • About half of the committee’s recommendations have been implemented in part or completely. Among those that have been implemented are raising the old-age pension for those elderly living in poverty, increasing the number of family social workers who deal with the poor population, expanding the supply of day care facilities, and enlarging the amount of public housing. Other significant recommendations, like the opening of savings accounts for each child (“Empowerment Grants”), are set to begin in 2017.
  • A central recommendation of the committee – merging activities that deal with poverty into the hands of a single, centralized authority which would be under the auspices of one of the main government ministries – has yet to be implemented. It seems doubtful that it will happen in the near future.
  • Committee estimates for implementation were about NIS 7.4 billion per year; in practice, the government has allocated only NIS 1.9 billion to date. The disparity stems from those recommendations that have yet to be implemented like increasing income security benefits and the lower than recommended level of resources allocated to those action items that have been implemented, including expanding the work grant (negative income tax), vocational training and the purchase of additional homes for public housing.

A new Taub Center Policy Brief written by Prof. John Gal, chair of the Taub Center Social Welfare Policy Program, and Shavit Madhala-Brik, Taub Center researcher, examines for the first time the implementation of the conclusions of the Elalouf Committee. After a careful check of the recommendations and the situation in practice, the research shows that while about half of the recommendations have been implemented, the major aims are very far from being fully realized.

 

The aim: To reduce poverty by about 50%

The Committee for the War Against Poverty (headed by MK Eli Elalouf) was an initiative of the Minister of Social Affairs and Social Services, Meir Cohen, in 2013, to recommend ways of dealing with poverty and to strengthen equal opportunity in Israel. The goals of the committee were ambitious: to bring about a reduction of 50% in the poverty rate, bringing the Israeli rate in line with the OECD average poverty rate. A similar effort has not been made in Israel since the early 1970s, and since then the social gaps have grown substantially.

During the course of the committee’s work, its 50 members prepared a long list of recommendations in the areas of housing, health, education, social security, and welfare. A central point in their recommendations was creating mechanisms to ensure that those in need would become aware of their rights and have access to the services and benefits to which they are entitled.

 

The situation in the field: Where do the recommendations stand today?

The Taub Center study examined the implementation of the central recommendations of the committee in the two years since their publication (2015 and 2016), as reflected in implementation data in the state budget and the proposed budget for 2016.

In the area of welfare and social security several recommendations were implemented. Among them:

  • 150 family social work positions were added.
  • The income security benefit for the elderly was increased. Beginning in January 2016, the benefit was increased by between NIS 130 and 175 for individuals, and NIS 510 and 540 for couples. According to the proposed budget for the coming years, an additional increase is expected in 2017 (an increase in expenditure of NIS 350 million) and in 2018 (an additional NIS 200 million).
  • A general increase in those budget lines that target the elderly and families in distress within the community (within the framework of the program, the Family Empowerment Initiative, literally “A Sigh of Relief”), both in 2015 and in the proposed budget for 2016.

Other recommendations that are in the process of implementation are finding solutions for resolving debt for those living in poverty, as well as “Empowerment Grants” (“A Savings Account for Every Child”), which are scheduled to begin in January 2017. Alongside these action items, Gal and Madhala-Brik note an important recommendation that has not been implemented: increasing the income security benefit to the level of two-thirds of the poverty-line income level (which is defined as about half of the median disposable income level for a household).

In the area of the economy and employment, some of the committee’s recommendations have been implemented, including:

  • Expanding the employment benefit (negative income tax) for single-parent families, those with disabilities, and the self-employed. The change is likely to increase the number of those eligible by about 55,000, and its cost is about NIS 130 million.
  • Expanding the vocational training system: the number of those participating increased in the past year by about 20%.
  • Enlarging the supply of public subsidized day care facilities for children of workers: there has been an increase of 6% in the expenditure related to this field in the 2015 budget and about 30% in the proposed budget for 2016.

In the area of housing, which was singled out by the committee as a central focus for dealing with poverty, many recommendations were proposed, and several are planned for implementation within the next few years:

  • The amount of rent subsidies for those eligible has increased between NIS 600 and NIS 900 a month. The budget lines have increased accordingly in the 2015 budget and the proposed budget for 2016.
  • Enlarging the stock of available public housing: as of August 2016, about 806 housing units were added to the public housing stock and an agreement was signed with the Jewish Agency to build 2,650 flats for seniors.

Among those recommendations not implemented are enlarging the circle of those eligible for rent subsidies and a program called “A Worthwhile Neighborhood” for neighborhood renewal.

In the area of health, a few recommendations were implemented including:

  • Public subsidies for dental care are in the process of being implemented for seniors over the age of 75 who also receive income assurance.
  • Student health services have reverted to the Ministry of Health in the Southern district. In the Northern district, the services will revert to the Ministry in January 2017. In the remaining districts, an agreement with “Natali” (“Healthcare Solutions”), for provision of health services for an additional four years was reached. At the same time, recommendations for improving the ratio of nurses in the schools to one for every 1,500 pupils was not implemented.
  • Public dental care for children up until the age of 14, and in the coming years, until the age of 18 was implemented.

Additional recommendations that are currently under consideration are those for establishing health promotion and prevention centers for the elderly and a reduction in the co-payment for medicines and medical services.

In the area of education, the Taub Center researchers noted the implementation of the recommendation to increase differential budgeting: about NIS 100 million a year were added to the budget for the purposes of increasing study hours in schools considered to be socioeconomically weak. On the negative side, they noted that the recommendation to invest in centers for preschool age children was not implemented.

In conclusion, Gal and Madhala-Brik note that there are quite a few positive points for the Committee for the War Against Poverty. From the perceptual perspective, the committee succeeded in putting the subject of poverty on the public agenda, strengthened the government involvement in ensuring that citizens realize their rights and contributed to the development of new systems to deal with the problem. From a practical point of view, the committee brought about a change in various policies that have the power to contribute to a reduction in poverty rates, and it will be seen if this trend continues to expand over the coming years.

Nevertheless, in light of the Taub Center research findings, there is serious doubt if the steps taken thus far (and those planned) will actually fulfill the targets of the committee and the principal among them: bringing the poverty rates in Israeli society down and close to the level in the OECD countries. As Gal and Madhala-Brik have said, “the doubt arises in part from the fact that the government has not as yet established a central authority to deal with poverty which makes inter-ministerial action difficult. Furthermore, the additional government expenditure in practice stands at NIS 1.9 billion (the change in the 2016 budget versus the 2014 budget) – a far cry from the expenditure addition recommended by the Elalouf committee, which was NIS 7.4 billion annually.” The discrepancy stems from the fact that the government did not implement some of the central recommendations of the committee, like increasing income security benefits, and allocated very limited resources to programs like employment grants, vocational training and the purchase of additional homes for public housing.

 

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The implementation of the Elalouf Committee recommendations is a central subject under discussion in this year’s Taub Center Annual Conference, on the subject of “Innovations in Poverty Policy”. The conference will be held on December 1 in Jerusalem. For additional details or to register, click here.

The study about the Elalouf Committee and the implementation of its recommendations will appear in the chapter “Public Expenditure on Welfare,” which will be included in the Center’s annual State of the Nation Report 2016. The report is due to be published at the end of December.

 

The Taub Center for Social Policy Studies in Israel is an independent, non-partisan socioeconomic research institute. The Center provides decision-makers and the public with research and findings on some of the most critical issues facing Israel in the areas of education, health, welfare, labor markets and economic policy in order to impact the decision-making process in Israel and to advance the well-being of all Israelis.

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