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Public sector goes on emergency footing, with PM promising ‘economic safety net’

To stem spread of coronavirus, private sector must thin 70% of in-office staff, 80% of government workers to go on vacation until after Passover

Finance Minister Moshe Kahlon, speaks at a press conference at the Prime Minister's Office in Jerusalem, on March 16, 2020. (Yonatan Sindel/Flash90)
Finance Minister Moshe Kahlon, speaks at a press conference at the Prime Minister's Office in Jerusalem, on March 16, 2020. (Yonatan Sindel/Flash90)

The public sector is going onto an emergency footing and private businesses have been ordered to reduce their in-office staff by 70 percent, under new instructions announced by Prime Minister Benjamin Netanyahu on Monday night to combat the spread of the coronavirus.

At a press conference in Jerusalem, the prime minister said that up to 80 percent of government workers would immediately go on vacation until after the Passover holiday (which ends April 15), with the numbers varying by office. He said a government order would be approved on Monday night to bring the instructions into effect.

Private businesses will be forced to dilute their staff by 70% as of Tuesday morning, Netanyahu said, sending employees to work from home or on leave.

The curbs do not apply to businesses with 10 workers or fewer, provided the employees keep a 2-meter distance between them, in accordance with “social distancing” rules.

Israelis buy food at a supermarket in Jerusalem on March 14, 2020. (Yossi Zamir/Flash90)

Essential services will continue as usual, including supermarkets, pharmacies, and banks, said Netanyahu. And public transportation will continue with some changes, he noted, without specifying.

In the wake of the economic curbs, Netanyahu said the government would provide an “economic safety net” for Israel’s citizens.

“I know this is a difficult time. Many people will be home and not at work. Many are concerned, perhaps they won’t have enough money,” said the prime minister.

Those measures, as outlined by Finance Minister Moshe Kahlon at the press conference, include a designated NIS 5 billion to aid those affected by the virus crisis.

He said workers placed on leave will receive “improved” unemployment benefits, with those employed for six months now eligible for the payments (it was formerly for workers who were employed for at least a year).

People wearing protective masks walk into Samson Assuta Ashdod University Hospital on March 16, 2020, in the southern Israeli city of Ashdod, as Israel introduces stringent measures to control the coronavirus pandemic. (JACK GUEZ / AFP)

Small business owners will be able to defer their property tax, water, national insurance and electricity bills if they cannot make the payments, said Kahlon.  He added that grants of up to NIS 6,000 ($1,600) would be made available to small businesses and freelancers.

The Finance Ministry’s chief economist, Shira Greenberg, estimated Monday night that the damage to Israel’s economy resulting from the far-reaching steps announced tonight by the government to contain the coronavirus will be NIS 45 billion ($12 billion).

The gross domestic product (GDP) is expected to drop by NIS 25 billion ($6.6 billion).

While cautioning that there is currently great uncertainty regarding the future impact of the pandemic on the global market, Greenberg said the growth in Israel’s economy is estimated to drop by three percent, reducing the state’s revenue by 1.2%.

The ministry on Monday night said that 298 cases of COVID-19 have been confirmed in Israel. Four were in serious condition and nine in moderate condition.

Israel has banned gatherings of over 10 people, closed schools, forced all Israelis entering the country into a 14-day quarantine, and ordered the closure of all malls, restaurants and cafes (with takeout permitted) to contain the outbreak.

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