Government must focus on helping war-torn economy, business heads urge

A forum of 200 leading businesses on Sunday urged the government to put an economic wartime aid plan into place with immediate effect, and to refrain from using coalition discretionary funding for any purpose other than for the war effort and relief for war-affected businesses.

In a public plea to Prime Minister Benjamin Netanyahu and Finance Minister Bezalel Smotrich, the business forum, which consists of the heads of about 200 of Israel’s largest companies, called for the government to take steps to ensure the economic resilience of the home front.

“Although we are already a month into the war, a substantial economic plan has not yet been launched to support the economy in general, and affected businesses and households in particular,” the business forum charged. “Most of the statements have not yet become actions, and in the meantime hundreds of businesses are collapsing and so are households.”

The Iran-backed Hamas terror group on October 7 brutally murdered some 1,400 people, a majority of them civilians, abducted at least 240 hostages, including babies and octogenarians, and devastated southern communities in a shock onslaught under the cover of a bombardment of thousands of rockets fired at Israeli towns and cities.

After Israel declared war and vowed to eradicate Hamas in the aftermath of the atrocities, the country’s defense forces called up more than 300,000 reservists. As a result, many companies have shut or are operating only partially and others such as retail firms have furloughed their employees.

On Thursday, the cabinet approved an outline of a war compensation package to help businesses continue operating as Israel continues its war with Hamas in the Gaza Strip. The plan, which includes grants to businesses across the country that have suffered war-related indirect damages, and benefits for employees put on unpaid leave, still needs to be passed by the Knesset.

“It’s time to stop talking and start taking action!” the forum demanded, calling on the government to immediately activate the grants compensation system, the provision of state-guaranteed loans and other allowances without red tape holding them up.

In recent days, the wartime economic plan presented by the Finance Ministry has been assailed by Economy Minister Nir Barkat and some trade and manufacturers’ associations for not going far enough, as they argue that it provides insufficient compensation for affected businesses and employees.

“Creating certainty during the difficult conditions of the war, for businesses — small and large — as well as for households, is necessary,” the forum wrote. “Any delay in implementation will lead to irreversible damage that will take a long time to restore, even after the war.”

The group of businesses, which includes mall chain Big Shopping Centers, Azrieli Group, fashion retail chain Fox Group, supermarket chain Shufersal, and banking institutions, also demanded that the government fundamentally change the order of priorities in the national budget to prevent a long-term economic disaster.

“All coalition budgets and any other funding that is not related to the management of the war or supporting the economy must be diverted solely for the purposes of financing the war and economic strengthening of the home front – businesses and households – while focusing on creating long-term growth,” the forum declared.

The 2023-2024 state budget, passed in May, included more than NIS 13 billion in discretionary coalition spending, much of which is allocated to educational programs for the ultra-Orthodox community.