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The Histadrut labor federation and the employers were united in their harsh responses to the poverty report issued yesterday by the National Insurance Institute, which stated that 1.6 million Israeli residents are defined as poor, and that income gaps in Israeli society continue to widen.

Nearly 100,000 Israelis joined the ranks of the poor in the past year. More than half of them, 55,000, were children. This brings the number of children living under the poverty line to 35.2% of all Israeli children, a record for the developed world.

Poverty increased mainly among families with four or more children, and in the Arab sector. The figures appear the Poverty Report for 2005 issued yesterday by the National Insurance Institute (NII).

The number of Israelis under the poverty line reached 1,630,500 in 2005, 24.7% of the total population. Children comprised 768,000 of this number, rising from 33.2% of all Israeli children in 2004 to 35.2% in 2005.

Histadrut Chair Ofer Eini said that it may be concluded from the report that the share of poor working families among all poor families has grown, and that 60% of employees who are beneath the poverty line are employed full-time.

"The worsening poverty stems from the ongoing lack of enforcement of government labor laws in factories and businesses," Eini claimed. "I proposed that the Histadrut allocate 300 of its workers, at its own expense, to tour work places with the object of ensuring that employers are enforcing the labor laws at their businesses, but the initiative met with opposition," Eini said.


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"A joint committee was formed recently for the Histadrut, private employers and the government to decide on ways of enforcing labor laws, but the government representatives are dismissive and not permitting the committee to reach binding agreements. The Finance Ministry does not care that workers' rights are being trampled," said Eini.

According to Eini, 30,000 new workers joined the public sector in recent years, mainly at ministries, government companies and local authorities. "Most of these workers are employed through personnel companies, at sub-standard terms," he said. "The drawers are filled with grandiose plans for reducing poverty and shrinking the gaps, but that apparently doesn't interest the government," Eini added.

'Raise minimum wage'

President of the Federation of Israeli Chambers of Commerce, Uriel Lynn, said that the federation favors raising the minimum wage gradually to NIS 4,000. "I also suggest that any worker who earns less than NIS 4,000 be exempt from the health tax and National Insurance fees, thereby turning the minimum wage paid to the worker into a net wage," Lynn said.

Former MK Hanan Porat, who chairs the Orot Hesed organization, which is preparing to distribute thousands of food baskets for the holidays, said that volunteer organizations are in a deep dilemma. While gratified by a sense of mission in helping the needy, they feel they are accustoming the establishment to rely on them. That is dangerous, Porat warns, because charities cannot meet all needs on a national scale.

Defense Minister Amir Peretz said in response to the release of the report that he will make sure that the financial demands of the military establishment do not come at the expense of the resources needed to reduce economic equality.