Israel's Poorest Get 28% of Income From Child Stipends

These stipends also make up 6.7% of the second-to-last decile's income, according to the data, pulled together by researcher Sarah Zwebner at the request of MK Ilan Gilon.

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A full 28.1% of the bottom decile's income comes from child stipends, the Knesset Research and Information Center has found.

These stipends make up 6.7% of the second-to-last decile's income, according to the data, pulled together by researcher Sarah Zwebner at the request of MK Ilan Gilon.

This comes in the wake of a report by the OECD which found that Israel has the highest rate of poverty among the 34 economically developed countries - at 20.9% of the population as of 2010, up from 13.8% in 1995 - and alongside plans by the government to cut child stipends as part of the 2013-2014 budget, in keeping with the draft approved by the cabinet early Tuesday morning.

The OECD report found that the poverty rate among children through age 17 and among people aged 18-25 increased by 2% between 2007 and 2010. This was the fourth biggest increase among all OECD nations.

More than one-third of Israeli children were poor as of 2010, giving the country the highest rate of poor children among developed nations.

The budget draft calls for cutting child stipends by NIS 2 billion. Currently they cost the state NIS 7 billion, and are allocated equally regardless of parents' income. Under the budget plan, families would receive NIS 140 a month per child, down from the current NIS 175-263.

Not surprisingly, the stipends become less meaningful the more the parents earn. For parents in the third decile, the stipends make up 3.2% of their income; in the fourth decile, the figure is 2.4%; and for the fifth decile it's 1.9%. As of the eighth decile, stipends make up less than 1% of the family's income.

The data was pulled from the Central Bureau of Statistics' 2011 salary survey.

According to May 2012 figures from the National Insurance Institute, a disproportionate number of poor families receive child stipends.

A full 67.9% of households within the bottom decile receive child stipends, according to the figures. Within the second-to-last decile, 60.8% of households receive child stipends, and in the third decile, the figure is 44.1%. The figure ranges between 49% to 45% for the fourth through seventh deciles, and is 39% for the eighth decile and 36.5% for the ninth decile.

"Finance Minister Yair Lapid is cutting education, welfare and health. With which services exactly does he expect poor families to raise their children?" charged Gilon.

National Insurance head Shlomo Mor-Yosef has said that the plan to cut stipends will send another 30,000 to 40,000 children under the poverty line, defined as a monthly income of NIS 4,000 for a couple.

Instead of cutting stipends, Gilon called for a graduated system whereby the highest stipends are paid for the first child.

Nadan Feldman, Meirav Arlosoroff and Lior Dattel contributed to this report.

A man searching for food in a dumpster.Credit: Tomer Appelbaum

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