Summary:
- The incidence of poverty, based on the relative index customarily used in Israel according to which the income of the poor households' population is less than half the median income adjusted for family size has been rising in recent years. In the year ending June 2005, it reached a peak of 24.1 percent. The relative incidence of poverty in Israel is high also by international comparison.
- Poverty grew significantly also according to alternative measures based on a definition by which households are considered poor if their net income from all resources falls short of the amount needed to consume a basket of basic needs. The data indicate that poverty rose from 2002 to 2004, after a fall in the two preceding years mainly due to economic growth.
- Poverty has risen since 2002 according to all indices' relative, absolute and mixed measures of basic needs' due, partly, to the recession and, in the last two years, to the budget cuts in social benefits,
- The incidence of poverty is high according to all methods among Arabs, the Jewish ultra-orthodox, large families, the low skilled and families without an income earner.
- The indices of poverty emphasize the need for a continued policy to reduce poverty, consistent with fiscal discipline that ensures sustainable growth. The policy should operate to encourage the integration in the work force of those capable of working, by increasing the return to work of low-income earners, and to assist the poor whose earning power is severely limited with direct support. At the same time, employability- and means-tests should be further improved.
Issues in Welfare Policy - Full File