Observant Jewry’s ‘Fiscus Judaicus’ Goes to Israeli Temples of Sin – Yet They’re the Parasites?!

With at least two party leaders, Yair Lapid and Avigdor Liberman, pledging to change the haredi status quo as part of their election rhetoric, the topic of haredim and their place in Israeli society is taking center stage once again.

What is it about Haredim that interests Israelis politically more than, say, security or the housing crisis? Well, exemption from army service is without a doubt a top issue. And many blame haredim for spreading Covid-19. But if you follow the extensive media coverage of haredim, you’ll notice that lack of contribution to the Israeli economy and manipulation of the national budget are an even greater source of contention for many citizens. As Liberman posted recently in Facebook: “On the day that Balfour ceases to be Deri, Gafni, and Litzman’s bank account, that is the day we can point to as the beginning of the Israeli economy’s recovery.”

Since I’m skeptical of populist statements, especially prior to elections, I decided to research the topic. I wanted to know: how accurate is the accusation against haredim of economic parasitism?

Most haredim work

“Haredim don’t pay taxes” is a refrain I hear fairly often. While some people erroneously believe that haredim managed to finagle a community-wide tax exemption, most faultfinders are simply referring to low haredi employment rates. No salary equals no taxes.

According to the Haredi Institute for Public Affairs, on the basis of figures from the Central Bureau of Statistics the general rate of employment in 2019 (before Covid-19) for Israeli citizens aged 25-64 was 78.44%. And for those defining themselves as haredim? 64.46%. Unquestionably lower than the general rate, but not low enough to tag most haredim as tax dodgers.

But with their large families maybe Haredim should be working more and not less than the average Israeli, instead of relying on the excessive government funding haredim allegedly receive?

Exactly how much financial assistance do haredim receive from the government? According to a statement by MK Yair Lapid last year, a 19-year-old haredi yeshiva student receives NIS 8,000 each month from the government. NIS 8,000? Really?

No, at least not according to Dr. Gilad Malach, a researcher for the Israel Democracy Institute, in the Institute’s “Haredi Society in Israel, yearly report (2020) ” (Heb.). The number of government shekels that end up in a yeshiva student’s pocket is, well, zero. The student’s yeshiva, which provides room and board for him, receives an average of NIS 418 per month from the government on his behalf. This is in contrast to university students, for whom the government provides an average budget of NIS 4,907 per student per month, more than ten times the amount yeshiva students receive.

Yeshiva students receive one other financial benefit from the government: they pay the minimum rate of NIS 128 for national insurance, as do all non-yeshiva students over the age of 18.

What about younger haredi students? How much funding do haredi elementary and high schools receive? According to figures for 2020 provided by the Ministry of Education under the Freedom of Information Law, mainstream elementary schools in Israel receive NIS 1,262 per student per month from the ministry. And haredi elementary schools? NIS 404 per student. The government finances NIS 2,625 of a standard high school student’s education per month, in contrast to NIS 655 for haredi high school students. If you’re wondering about the discrepancy in funding, it’s due to a penalty applied to the haredi education system for not fully complying with Israeli regulations for core curriculum studies.

What about older students?

So, the Haredi students aren’t breaking the national budget, but what about their parents? How much government funding is funneled into the bank account of a haredi who learns in kollel, a yeshiva for married students?

Complaints about financial assistance to kollel attendees and other haredi adults usually revolve around the following benefits: kollel stipends, child allowance, property tax reductions, national insurance reductions, day care reductions, and welfare. Of course, the latter five benefits are available to any citizen, but let’s consider them, since haredim with low income and many children tend to qualify more easily and receive greater amounts than typical secular families.

Let’s make a tally. The government provides an average stipend of NIS 752.80 per month to kollel students. An average haredi family with eight children under the age of 18 receives a total of NIS 1,336 in child allowances each month. Property tax rates depend on the municipality and type and size of the dwelling, but let’s include in our tally the maximum reduction available for a typically-sized haredi apartment of 100 square meters. In Jerusalem, for example, such a reduction comes to NIS 564 per month (on the basis of the rate for Zone B, which contains many haredi neighborhoods). Kollel students also pay the minimum national insurance rate of NIS 128. Compare the minimum rate to an employee earning the national average wage of NIS 10,551 who pays about NIS 728 in national insurance and health tax, and we can add a savings of NIS 600 to our tally.

It’s reasonable to assume that kollel families enjoy significant discounts on state-sponsored day care, since reductions are based on income per number of family members, and haredim tend to have many children. But the maximum discount is only available for mothers working close to full time. Fewer working hours mean less of a discount, and paying the costly fees on a part-time salary often doesn’t make sense. Only 57% of employed haredi women actually work full time, and some of those women obviously don’t have day care-aged children. So, although some kollel families do enjoy this benefit, the majority do not. Indeed, there is a proliferation of private day care groups in haredi communities.

A family whose father is in kollel cannot qualify for welfare provided by the National Insurance Institute of Israel (known as Income Support). There is a monthly welfare stipend of NIS 1,040 from the Ministry of Education available for kollel attendees for up to 5 years, but to qualify one must have at least three children, a combined gross family income of less than NIS 1,200 per month, not own a car, and jump through flaming rings of fire. (Alright, not the last condition.) I personally don’t know anyone who qualifies.

So, our final tally per kollel family is approximately NIS 3,250 per month, plus day care reductions for some. Yup, that’s it. Of course, many non-haredi citizens also enjoy some of the benefits included in our calculation. Another point of interest is that most haredim don’t benefit from certain other areas of government funding, such as the national budgets for sports, culture, and entertainment.

Now if our tally only reached NIS 3,250, how is it that so many people swallow false statements about haredim and government funding, such as the NIS 8,000 claim by Lapid?

Part of the misconception may stem from a simple deduction that large families couldn’t possibly sustain themselves on so little. The only logical conclusion is that the government must be supporting them. It’s a reasonable assumption that requires investigation.

So how do haredi families make ends meet?

Several factors contribute to the haredi community’s ability to survive economically. First of all, work. As discussed previously, and contrary to popular opinion, most haredim do work. Another contributing factor is the simple haredi lifestyle. Essentials for many in the secular world such as trips abroad, movies, theater, sport events, clubbing, and electronic devices like smartphones and televisions are considered either taboo or unnecessary luxuries for most haredim. Second-hand clothing is commonly used; less than half of haredim own a car; and the vast majority live in relatively small apartments.

The cohesive and collective nature of haredi communities also impacts economic life. The plethora of free loan societies (known as gemachim) providing everything from wedding dresses to electric screwdrivers to baby cribs, often precludes the need to purchase such items. Interest-free cash loans are also readily available.

And last but not least, financial assistance from outside Israel. Most kollel heads fundraise abroad (before Covid-19), supplementing the base stipend provided by the government with money from private donations. Various charity funds that provide haredi families with food for the holidays, at-cost clothing and shoe sales, half-priced bedding, and various other living expenses, receive most of their donations from the good-hearted religious Jews of the diaspora. Let’s not forget the individual financial assistance that many haredim receive from family and friends, allocated within the context of supporting Torah learning in Israel, considered from a halakhic point of view a preferred allotment of charity tithes. The bottom line here is that haredim are responsible for pumping hundreds of millions of dollars, pounds, and euros into the Israeli economy each year.

It’s difficult to believe that the truth could be so distant from the media’s depiction and the common financial perception of haredim. It’s convenient to build a political campaign on the human tendency to search for a scapegoat, especially following a most troubling year. But maybe we should consider voting for a candidate with positive goals and plans, a leader who wishes to build, progress, and unify, instead of unjustly turning an already fractured nation against a segment of the population. Then these elections will really be worthwhile.

The writer is an independent commentator.

Editor’s note: The “Globes” fact-checking desk “Hamashrokit” (“The Whistle”) recently examined a claim by Yisrael Beitenu leader Avigdor Liberman on Kan Bet radio that state transfers to haredi families amounted to NIS 7 billion annually. Hamashrokit concluded that the true figure was approximately NIS 2.5 billion, of which NIS 1.3 billion was in the form of child allowances, which are paid to parents in all communities in Israel.

Published by Globes, Israel business news – en.globes.co.il – on February 8, 2021

© Copyright of Globes Publisher Itonut (1983) Ltd. 2021

From Globes, here.