During an extraordinary Cabinet meeting that lasted from Thursday evening until Friday morning, the Ministers unanimously adopted the Finance Minister Moshe Kachanom the draft state budget for 2019 and the draft law on economic regulation. The volume of the state budget for 2019 will be 397,3 billion shekels. The education budget is 60 billion, the health budget is 38 billion shekels in the budget for social needs and support program Holocaust survivors will be NIS 13 billion on disability benefits is allocated 2 billion shekels. The defence Ministry’s budget will amount to 63 billion shekels. The planned government budget deficit in 2019 will amount to 2.9% of GDP, and in 2020 – 2.5% of GDP.
According to the press service of the party «Kulanu», which leader is the Finance Minister, the draft budget includes a number of reforms, the program «Family net»; state insurance program to care for the sick; enhancing the competitiveness of the market of television services; banking reform, which will allow customers to change the Bank by pressing one button with automatic transfer of all financial liabilities; lower prices for private surgery; shorter working week; the reform to reduce the school holidays; a reduction in the amount of cash; the increase in supply in the housing market; support entering the labour market, which is to provide operating subsidies; and the reduction in the number of government ministries and departments.
In the period from 2014 to 2019, the budget for education increased by 38% (to $ 16.6 billion NIS), the health budget has increased by 60% (14.1 billion), the budget of the national insurance Institute increased by 37% (12,95 billion), the budget for aid to Holocaust survivors increased by 41% (1.4 billion), the budget for defence increased by 37% (15.4 billion).
«The state budget in 2019 would be a social-oriented growth and the strengthening of the Israeli economy. The growth of the economy allows us to allocate more funds for social needs, – said the Finance Minister Moshe Kahlon. Finance Minister is not the Treasurer, its function is to develop the market and distribute the results of economic growth on important goals and the needs of population groups that have ignorirovanie too many years. Our new budget continues the social revolution and determines the new allocation of funds».
Government-approved bills continue economic program based on the following basic principles:
The fight against high cost of living
Shortening the school holidays, designed to reduce the difference between the duration of the school holidays and parental leaves. In the framework of this program during the holidays Hanukkah and Pesach, the students will receive five days of classes. This will help parents reduce the cost of the holiday, remove them from excessive load, as well as expand, we offer government services extra-curricular education.
Subsidizing the extended-day groups in the framework of the «Family net» operates in all regions of the country. The government voted to continue this program until the end of the 2018-2019 school year. In extended-day groups, children are engaged, have a rest and receive a hot meal under the supervision of teachers.
A shorter working week in the Israeli economy: the working week will be reduced to 42 hours to balance the amount of working time and family vacations for Israelis. According to the existing agreements, the reduction of the working week will be no reduction of wages, and since the law came into force, the salary will be calculated on the basis of 182 hours per month, not 186, as it is now. In the result, the hourly rate will increase.
Change of the Bank with one click: to improve the competitiveness on the banking services market and reduce the cost of these services for the end user it was decided to remove impediments to the Israelites just as easily change the Bank. Under the new rules, when the change of the Bank’s financial programs, monetary obligations and regular orders will be transferred to the new Bank automatically. This includes the abolition of credit cards, transfer payments on new credit cards, and the replacement of the previously issued checks, and the notification of the employer about the new account for transfers of salaries, and much more. The process will be transferred according to the technology of «follow me» («what is aharay»), similar to the way it was made in the course of Moshe Kahlana when he was named Minister of communications the reform of the cellular market. The client will have to provide new Bank, only your Bank account number old Bank.
Removing obstacles to personal imports. In the framework of the government’s efforts to reduce the high cost of living, lower consumer prices and stimulate the competitiveness of the market will apply the recommendations of the special Commission for the support of parallel and personal imports. In particular, we will adopt uniform and clear rules about the number of imported under the personal import of the product and its maximum value. In addition, responsible for this area of the Department will provide users with detailed information about the rules and regulations of personal import.
The elimination of obstacles to import communications. In the framework of the government’s efforts to reduce regulatory burden will be also abolished the need to obtain a special permit for the importation of various equipment for wireless communication. This should help the various enterprises of small and average business, and also lead to lower prices for consumers. Currently, many types of equipment and electronics require special permits from the Ministry of communications: we are talking about importing laptop computers, tablets, RouterOS and the like. This system reduces the rate of appearance of modern electronics on the shelves of Israeli stores, prevents competition importers and sellers, but also leads to overpricing. The programme will create a group of experts that will develop a list of equipment for the import of which still required a permit, but this list will not be shorter than the current example. This will extended the authority of the Ministry of communications, which would ensure normal operation of various means of communication at different frequencies. These steps should simplify the import of wireless electronics and lead to savings of hundreds of millions of shekels a year.
Support competition in the market of television services. It is planned to significantly reduced regulation of the market of television services, which should lead to increased competition and lower prices for the consumer. Currently, the market of television services is divided between cable and satellite companies and the Second control of the broadcasting controlling broadcasting on commercial channels. The second authority for television and radio broadcasting, in turn, acts on the basis of outdated legislation that requires strict regulation of the market and content. Given the technological changes and the emergence of new players on the world market of TV services instructions will be amended in order to allow these players to enter the Israeli market and compete on a balanced field. Of course the user can obtain only those products in which he is interested, without the imposition of additional channels and services within «packages». As a result, each family will be able to save on television service thousands of shekels a year.
Is created the Agency for analysis of conflicts between insurance companies and their customers. The current system of relations between insurers and insured is unbalanced, because the insurance company much more funds, forces and capabilities, while clients do not have sufficient knowledge, time and funds. Controller conflicts will provide a fair analysis of disputes, to ensure the rights of the insured and to reduce the burden on the judicial system.
It will also set up an experimental environment for companies operating in the field of financial technologies. To simplify these companies to offer their services in the Israeli market, will be introduced favorable regulations for innovative companies, providing financial services such as lending, provision of payment, clearing, investment management, financial management, banking services and insurance.
The reduction of social gaps
State insurance program for the care of feeble aims to enhance, improve and make more efficient facilities for the care of the infirm. The program will take effect in 2018, it will significantly increase the number of hours for home care for the elderly, as well as provide dental services within the basket of subsidized drugs and technologies. Increased the participation of health insurance companies in the process of rehabilitation of seriously ill patients and the elderly, and in the process of caring for the infirm at home. The family will be exempt from a large proportion of the load will be reduced by the amount of accompanying bureaucracy.
Reform to reduce prices for private surgery will reduce the cost of Israeli families for these treatments. In the framework of this reform will be solicited and studied prices for private operations and their profitability, and then developed a list of maximum prices. The goal of the reform is to put an end to a situation when there is a quick and effective «medicine for the rich» and the slow and inefficient «medicine for the poor», often on the basis of the same medical institutions and using the same doctors.
Support employment of single parents. Income of single-parent families expected less income families where both parents work, leaving children and single parents have fewer opportunities in life. The government is launching a program to support single parents, including encouraging their participation in the labour market, the creation of private businesses («acmain»), the expansion of eligibility criteria for subsidised professional support and much more.
Increase disposable income for working families by increasing the «labor award» («Mayak Avoda»), or a negative income tax. This program promotes parents to the labour market. In particular, «labor award» for the working father will be increased by 50%. To support access to the labour market of both parents «Manak labor» for working spouses will be increased by 30% if one spouse earns 3.540 shekels a month. Still for maximum «labor award» the salary was to be 4.780 shekels a month. Thus, to increase significantly the number receiving the maximum «labor award», which will bring additional families above the poverty line.
Support the competitiveness of the market and economic growth
Program «Net Industry» is designed to strengthen the industrial sector of the Israeli economy. In the framework of this programme will be allocated 1.15 billion shekels to support small and medium-sized businesses in the industrial sector, the creation of new and expansion of existing enterprises, training of employees, acquisition of new efficient technologies, reducing the cost of production and increase productivity.
Reform of technological education in Israel, developed with the participation of the Forum of technological colleges, is designed to significantly increase the level of technology in Israel and to adapt it to the needs of the local and global market. The budget of the technological colleges will be increased, which will help them to expand their activities and to maximize the potential of technology education. Will also strengthened the regulation of technological colleges to ensure the quality and relevance of curricula that meet the requirements of the employment market.
The acceleration of the construction of the distribution network of pipelines for natural gas, in parallel with promoting competition in the fuel market and the construction of solar energy should stimulate the production of electricity with emphasis on renewable energy. In particular, increased the limit of exemption from payment for solar installations from the current 200 square meters to 6000 square meters.
The establishment of offices of public transport in Jerusalem and be’er Sheva, who will preside over public transport in the respective service zones. Management of public transport tariff zones to urban centers is the most effective system adopted in developed countries, since local experts are more familiar with the needs of the population and features of the transport infrastructure of your metropolis, and upon receiving the required authorization can increase the efficiency of the public transport system.
Reducing road congestion and encouraging joint missions. The government will encourage the use of non-motorized vehicles, public transportation and share rides in cars. In particular, for trips cars passengers will open up lanes for public transport, they also will receive discounts or even exempt from payment of toll highways. Will also be supported by the use of «Park and ride». All this is intended to reduce the load on the Central part of the city in the daytime and to optimize the use of transport.
It is planned to change the distribution system of sports budgets, reducing the dependence of the sport from betting systems and betting. Will increase the budget of the Ministry of culture of sports that will allow the state to implement its policy on the market of legal gambling.
Optimization of the public sector
The system will be optimized to attract foreign specialists in the sphere of high technologies: they will be allowed to attract up to one year. Work permits of such employees shall be extended every year up to the period of 63 months. The mechanism for granting permissions to employment of qualified experts in the field of hi-tech will be streamlined so that potential candidates have certainty and can plan its work before filing an application for participation in the competition. In the projects implemented in the framework of the Law on compulsory tenders, foreign experts could be used only in the case that Israel has no specialists with the necessary qualifications. For the recruitment of foreign experts in government agencies will still need the permission of the Ministry of labour, Department of registration of population and distribution Department budgets at the Ministry of Finance, but personally Ministers will not be needed.
Optimization of local authorities: the composition of the tender commissions in the local authorities would be changed in favor of professional employees instead of representatives of various political parties and currents. This will help to ensure that the decisions of professional considerations and appropriate to the needs of the local Council or municipality and not for political reasons one or another party.
Improvement of the selection process and audits of candidates for the contests in the state structures. The process of selection of employees will be accelerated and optimized so that the candidate relevant qualifications were found in the shortest time.
Reducing the number of ministries in the framework of government efforts to reduce budget spending and optimization, starting from the next government, the number of state ministries will be reduced to 17.
The increase in housing supply
For the implementation of the government’s efforts to expand housing for rent, student housing, and rental apartments employment centers, support mixed-use commercial, public and residential buildings in areas of high demand, reducing the process of obtaining building permits and changes to the system promoting the implementation of housing projects. Will be allowed to include public institutions and kindergartens in residential and commercial buildings, just as it is done in the developed world.
Optimization of the process of licensing the construction of national infrastructures is designed to reduce the duration of the projects and to minimize the level of accompanying bureaucracy.
The reduction of «black capital»
The decrease in turnover of cash and support for electronic payment systems and cashless payment aims to reduce the share of «black economy» in Israel, which is now estimated at 22% of GDP. The program is divided into two stages: the first stage in the commercial sector, the maximum volume of transactions conducted in cash, will be reduced from 10 thousand shekels to 8 thousand shekels, and in the private sector with 50 thousand shekels to 25 thousand shekels. The second stage will reduce the limit of transactions of 5 thousand shekels for the commercial sector and up to 12,500 NIS for the private sector.