Over a million Israelis start receiving government coronavirus handouts

Payments for parents arrive first in controversial NIS 6.5b stimulus plan, to be followed by transfers to the elderly and, eventually, the rest of the population

Then-prime minister Benjamin Netanyahu (R) and then-transportation minister Israel Katz attend the inauguration ceremony for a new train station in the southern town of Kiryat Malachi, September 17, 2018. (Flash90)
Then-prime minister Benjamin Netanyahu (R) and then-transportation minister Israel Katz attend the inauguration ceremony for a new train station in the southern town of Kiryat Malachi, September 17, 2018. (Flash90)

The National Insurance Institute began rolling out Prime Minister Benjamin Netanyahu’s coronavirus stimulus program on Sunday, direct depositing grants to some 1.2 million Israelis, with more expected to be paid out in the coming days.

The first wave of handouts consists of money for families with children under the age of 18, with seniors coming next and, eventually, the rest of the country’s adult population.

National Insurance Institute director Meir Spiegler called the rollout of the stimulus plan the largest project ever undertaken by his agency, adding that it had been operating in an emergency capacity since March.

The institute said that it would continue transferring payments to one million Israelis daily until everyone had received their stipends, Channel 12 reported.

National Insurance Institute’s Director General Meir Spiegler at a conference at the Jerusalem International Convention Center (ICC) on September 3, 2018 (Yonatan Sindel/Flash90)

The Knesset approved an amended version of the prime minister’s controversial multi-billion-shekel handout plan last Wednesday, after political backlash forced Netanyahu to agree to a number of revisions.

When fully rolled out, the program will see more than NIS 6.5 billion ($1.9 billion) disbursed to eligible citizens.

The measure was approved after undergoing several revisions since first being unveiled by Netanyahu on July 15, when he said it was vital to get the money out quickly in order to get the wheels of the economy moving again.

Under the original plan, all Israelis aged 18 and over were to receive a one-time payment of NIS 750 ($218). Couples with one child were to receive NIS 2,000 ($583), rising to NIS 2,500 ($729) for those with two children, and NIS 3,000 ($875) for those with three or more.

But criticism of the plan’s call to disburse money to all Israelis — regardless of income or whether they were hurt economically by the government-mandated restrictions to contain the virus — prompted Netanyahu to backtrack and announce that high earners would not receive the handouts while people receiving certain government benefits would get more.

A National Insurance Institute building (photo credit: Yossi Zamir/Flash90)
Illustrative: a National Insurance Institute building. (photo credit: Yossi Zamir/Flash90)

Senior officials in the treasury, including director Keren Terner Eyal, opposed the plan ahead of its unveiling, likening it to “throwing suitcases of money that we don’t have into the sea,” according to Channel 13.

Last Tuesday, following political pressure from the Arab and ultra-Orthodox communities, Finance Minister Israel Katz agreed to increase the stimulus checks for large families.

Under the revised plan passed on Wednesday, families will receive NIS 500 ($146) for each of their first four kids, with another NIS 300 ($87) from the fifth child onward.

The Finance Ministry also agreed to increase the payouts for newly released IDF soldiers, raising the sum from NIS 750 ($219) to NIS 1,250 ($365) for those discharged in the past year.

The changes came after negotiations between the treasury and United Torah Judaism MK Moshe Gafni, who oversees the Knesset’s Finance Committee and threatened to block the entire aid plan if no changes were made. A similar demand was made last week by MK Ahmad Tibi of the predominantly-Arab Joint List party.

United Torah Judaism MK Moshe Gafni chairs a Knesset Finance Committee meeting on March 5, 2018. (Yonatan Sindel/Flash90)

The Orthodox and Arab communities have significantly higher birthrates than other Israelis, meaning the amendment primarily benefits them.

Increasing numbers of Israelis have reported feeling anxiety and concerns over their ability to pay their bills during the resurgent coronavirus outbreak, the Central Bureau of Statistics reported on July 26,.

According to the CBS, 55 percent of Israelis were concerned over their ability to cover monthly expenses during the economic downturn and that more than a fifth had either reduced their food intake during the crisis to save money or lived with someone who had.

During a national lockdown in March-April, the economy came to an almost total standstill. Unemployment soared to 26 percent and over a million Israelis were out of work. Over the past few months restrictions have mostly been lifted, but unemployment remains at over 20% with some 800,000 Israelis jobless, according to the Israeli Employment Service.

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