Israel's Social Security Agency Still Charges Furloughed Workers for Old Debts

Unemployed Israelis barely managing to make ends meet pay National Insurance Institute for debts they didn't know they had

Lee Yaron
Lee Yaron
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The National Insurance Institute building in Tel Aviv, April 17, 2020.
The National Insurance Institute building in Tel Aviv, April 17, 2020.Credit: Emil Salman
Lee Yaron
Lee Yaron

Zero unemployment benefits. That’s how much Amal Abu Sneineh, 30, a single mother of two from Jerusalem, is receiving.

Like many others, she was sent on unpaid leave from her secretarial job in mid-March, and thought that her unemployment benefits would provide her with some basic sustenance. She was supposed to receive 2,488 shekels ($709), but the entire sum was withheld to cover a debt that she didn’t even know she had. Since she discovered this on the National Insurance Institute website on Tuesday, she says, she hasn’t stopped crying. “I have no idea what I’m going to do. I was so waiting for this money for rent and food for the children,” she told Haaretz.

Daniela Mashayev, a single mother of one from Afula, got a notice from the NII earlier this week that she was getting an unemployment payment of 146 shekels. After she was furloughed from the day care center where she worked, she found out that because of a debt to the NII that she was unaware of, she would be getting almost nothing from the 2,200 shekels she was expecting.

“I work hard and now this is the first time my bank account is in overdraft,” she told Haaretz. “I called my father at 7 A.M. crying hysterically. How am I going to buy my daughter rolls for preschool? I don’t have five shekels to buy her rolls. How will I buy her clothes to go back to preschool? How will I pay my bills?”

Then there’s the man who was receiving a 5,300-shekel disability allowance, from which 700 shekels was being garnished to pay an old debt. Because he is in a high-risk group for the coronavirus, he had to stop working. Yet the deduction is still coming out of his allowance.

These are not exceptional cases, it turns out. Haaretz has learned that the NII is continuing to deduct payments for old debts from people’s benefits even during the coronavirus crisis, based on the authority it has to do so during routine times, and is leaving many people with almost nothing to live on, since they are on unpaid leave and have no way to work.

The legal clinics at several universities and colleges, along with the Association for Civil Rights in Israel, have sent letters to the NII demanding that it stop the practice.

The NII responded that after an administrative examination, it had decided not to deduct money for “new” debts (meaning those that were created since February of this year), from unemployment, the adjustment allowance for laid-off workers aged 67 and older, and from the one-time grants connected to the current crisis, other than those related to repossession or child support. But this doesn’t help those getting allowances who have “old” debts, from before February, who are forced to make do with a reduced allowance.

What’s more, many people, like Abu Sneineh and Mashayev, don’t know whether their debts are old or new, or even how they were incurred. “I have no idea why I have a debt,” says Mashayev. “I only know I have no money for food.”

The situation led attorney Asaf Deri from the Clinic for Repossession Rights at the College of Management to submit an urgent petition to the High Court of Justice against the NII, asking the court to order the institute to stop deducting from allowances and to pay them in full during the coronavirus crisis period. This week, Justice Yosef Elron asked for an urgent hearing on the matter by a panel of three justices.

A woman walks in front of empty fridges set up as a protest against government policy by freelance and independent workers on Habima Square, Tel Aviv, April 30, 2020. Credit: Tomer Appelbaum

The reasoning behind the NII's decision to only make deductions for old debts was that the repayments are already factored into a person's budget and therefore do not constitute "harm to the level of [their] income. By contrast, someone getting a regular allowance and incurring a new debt, won’t have the level of income he was used to before the crisis started.”

This is what Orna Verkovitzky, deputy director general for benefits at the NII, wrote in response to a letter from Vardit Damari-Madar, director of the Center for Legal Education at Hebrew University Law School, and attorney Ohad Amer from the clinic for representing populations in the periphery. “We don’t believe that the distinction between old debts and new ones is relevant to this issue,” the two responded in writing, explaining that it isn’t always clear how the debt was incurred.

Deri, in his petition, elaborated on why he thinks the NII must use better judgment in deciding to continue to collect past debts from allowances during the coronavirus crisis. “The NII must take into account the serious consequences of the national and global crisis for poor and vulnerable citizens whose entire livelihood now rests on the NII allowances, which are low in any case, and even during routine times provide the absolute minimum that allows for bare survival. Deducting from allowances that during the crisis serve as their only source of income can’t in any way be perceived as reasonable and balanced,” he wrote.

One of the people on behalf of whom Deri is petitioning is Moshe Shavi, 64, who is divorced and the father of four adult children. When he and his wife officially separated more than 20 years ago, he left the apartment to her and their children. Now he has almost nothing and had to declare bankruptcy. Over the past few years his health deteriorated and his immune system has been compromised. He has been recognized as 100 percent disabled and gets a monthly disability allowance of 3,200 shekels, of which 400 is deducted to pay old debts for child support.

Even during normal times, that was not enough for him to get by, and his children would help him buy food and medicine. Now, with the health crisis, not only can his children no longer be of help, but since he cannot leave home, he must rely on delivery services, which raises his costs. Every shekel he loses, he says, makes it that much harder to finish the month.

Empty streets in Jerusalem's Old City amid the coronavirus pandemic, March 20, 2020.Credit: Ohad Ziegenberg

Both the Association for Civil Rights in Israel and the Clinic for Human Rights in Society at the University of Haifa have asked the court to join Deri’s High Court petition. “The petition deals with the reasonable character of continuing to deduct debts from benefits, a decision which is not a legal requirement, but a judgment call. There is inequality between benefit recipients with new debts and benefit recipients with past debts. This undermining of equality approaches a constitutional violation of human dignity. Imposing a discriminatory policy on an arbitrary and unreasonable basis demands judicial intervention,” wrote attorney Maskit Bendel from ACRI and Reut Cohen of the legal clinic.

In its response to the petition, which the NII argues should be categorically dismissed, the institute said it has taken many steps out of consideration for the difficult economic situation – which, it noted, has also affected the institute itself. “Not only has the institute improved its collections and hasn’t increased the rate of deductions, but the overall collection of national insurance payments has been undermined during this period,” it said. It also argued that the institute’s offset policy “both in routine times and in crisis periods is reasonable and proportionate and definitely doesn’t deviate from the realm of reasonableness.”

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