Government announces plans to ease costs for parents of kids aged 0-3

At a press conference Sunday, Prime Minister Benjamin Netanyahu, Finance Minister Bezalel Smotrich and Education Minister Yoav Kisch unveiled what they said was the first stage of their plan to subsidize daycares for children aged 0-3.

Netanyahu committed during the last election campaign to support a solution for free education for that age group.

Sunday’s announcement did not fulfill that promise, but is expected to ease the financial burden on employed parents.

The three main points of the plan are:

• A tax benefit worth NIS 940 ($260) per month to parents who are both employed per child aged 0-3, starting January 1, 2024.
• Current partial subsidies for state-regulated daycares will rise by several hundred shekels up to NIS 1,700 ($470) per month, starting in September 2023. Alongside the aforementioned tax benefit, children at state-subsidized daycares should be fully covered (some 20 percent of all children).
• NIS 2 billion ($550 million) will be committed to “dramatically increase” the number of state-regulated daycares across the country within the next five years, with the goal of eventually ensuring free education for ages 0-6.

Referring to the tax benefit, Netanyahu said Sunday: “This means that if you have a child now, you will receive about NIS 30,000 ($8,000) for that child in the next three years.”

The state-regulated daycares are intended for children aged 3 months to 3 years and are operated by non-profit organizations under government supervision. Parents contribute a monthly sum determined by their income, usually around NIS 1,000 to 2,000 ($290-580). As space is usually limited, parents at a lower socioeconomic level are prioritized.

Illustrative: Teachers clean a classroom at a daycare center in Modiin on May 7, 2020. (Yossi Zeliger/Flash90)

Netanyahu said the goal is to lower the cost of living, to “raise the pedagogic level,” and to allow every “working family in Israel to get their kids into kindergarten.”

Kisch noted efforts to improve the quality of daycare workers: “We are expanding training. Every daycare worker that takes a course will receive a grant of NIS 2,500.”

In total, the cost of the program amounts to NIS 5 billion ($1.4 billion) per year, according to Kan news.

“We are only four months into this new government… and now we are helping parents save at daycare,” Smotrich said.

“The media is conducting a campaign of lies and not explaining our efforts. We will continue to struggle against the cost of living,” he stated.”As finance minister, the issue is constantly in my sights… I am aware of the difficulties.”

The government has come under growing criticism for rising costs in recent months, with many lashing it for focusing on its efforts to overhaul the judiciary instead of cost of living issues that concern most Israelis far more.

Yisrael Beytenu party chair Avigdor Liberman of the opposition accused Netanyahu of trying to “buy time” with the plan.

“All that needs to be done is to cancel the doubling of funds for yeshivas, the 50% increase in allowances for married yeshiva students, and the addition of NIS 3 billion given to Haredi education that does not teach core studies,” Liberman tweeted.

“All this is enough to fund free education for children of employed parents up to the age 3, or to really fight against the cost of living,” he wrote.

Yisrael Beytenu party chairman MK Avigdor Liberman at the Knesset, on April 16, 2023. (Yonatan Sindel/Flash90)

The Forum of Private Daycares (i.e., non-subsidized) also assailed the plan, accusing the prime minister of “discriminating between children and families across Israel.”

“This is an unprofessional, partial solution, that doesn’t offer a solution to 80% of toddlers and their parents in Israel, the middle class, and most of the Israeli public that is suffering under the cost of living,” the group said, and vowed not to support it.

The plan was praised by Mor Dekel, the chair of the Israeli Association for Early Childhood, but she added there was still work to be done.

“The immediate need to take care of the field of early childhood in the country has not ended. Unfortunately, no response was given to the issue of manpower in the field. Currently, there is a great shortage of carers in Israel,” she said.

Professor Esther Adi-Japha, an early childhood expert at Bar Ilan University, also reacted positively to the plan, particularly for its recognition of the importance of education for the age group.

“I am happy that this budget will be used in a way that benefits children, and I implore the heads of the system… to continue to ensure the quality of education they will receive by strengthening the existing infrastructure, particularly manpower,” she said in a statement.