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The plan that crashed: only 5% success for the return to work outline

This is what a compromise between the National Insurance Institute and the Treasury looks like: 5% success of the program for returning the unemployed to work.

Out of almost half a million unemployed, only about 24,000 returned to work - thanks to the grant program.

How did we get to a situation where the economy is desperate for workers, but the employment bureaus are full of the unemployed?

Tags

• Ministry of Finance

• Social Security

• Meir Spiegler

• Israel Katz

• unemployment

• employment

• Avichai Mandelblit

Sonia Gorodisky

Wednesday, 28 April 2021, 08:35 Updated: 09:04

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The program to encourage the unemployed to return to work is not really encouraging: "The people no longer believe in the programs"

In two days the program will end, under which a grant can be received from the state for returning to work, and from the data that reached Walla!

It appears that the program has failed to encourage a massive return to work.

To say the least.

Out of the potential of 472,000 unemployed, during March and the first two weeks of April, only about 5%, which is about 24,000 unemployed, took advantage of the eligibility for the grants and returned to work under the program.

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Social Security.

Compromises with the Treasury have created an ineffective plan (Photo: Reuven Castro)

The layout is complex and not rewarding enough

The plan that was formulated extended the previous outline, according to which the unemployed who did not work for 75 days and returned to work at a lower wage than they had before leaving for the IDF, were entitled to wage supplement grants.

The main innovation in the new outline is NIS 3,000 for unemployed people who did not work 130 days In succession and they would agree to return to work for four months. But the plan proved ineffective for two reasons: the outline was too complex for the unemployed not to understand exactly what they deserved, and also because the plan was not rewarding enough.

According to recent CBS data, despite removing restrictions As of March, the number of unemployed in the economy was still high and stood at more than half a million people.

Finance Minister Israel Katz. The Ministry of Finance is confident that "the program has yielded a significant achievement" (Photo: Reuven Castro)

"It takes 800 in psychometrics to understand"

The success of the incentive program to return to work was critical during the opening of the economy, when in the background many business owners in the fields of commerce, restaurants and hotels are still unable to recruit workers. These are mainly young people who earn a low wage who prefer to take advantage of the Khalat period to the end, some of whom are in Khalat for a period exceeding three months.

To encourage their return to the labor market and, in fact, to fight the Knesset model,

Meir Spiegler, the director general of the National Insurance Institute, made a proposal a few months ago

that all veteran unemployed people who return to work (not necessarily at lower wages) receive two full unemployment benefits in the first month And the fourth for their return to work. This is in addition, to supplementing the salary for those who return to the fact of a low-paid position.

The Prime Minister and the Minister of Finance adopted the proposal and even included it as one of the sections of the economic plan presented by them at the end of January

and included, among other things, a grant for each citizen.

Most parts of the plan did not receive the blessing of Attorney General Mandelblit

and the important clause designed to speed up the return of the "veteran" unemployed to the employment circle changed greatly.

The plan that was eventually accepted was a compromise between the Treasury and Social Security and went into effect at the end of February. Due to the complexity of the calculation of the wage supplement grant, which in any case was not attractive enough for the Corona unemployed, the other notable disadvantage of the program is the fact that those who return to work at a wage similar to what they had before leaving the Knesset will not receive a state grant.

The rationale behind this was that those who return to work at their regular wages do not need an incentive, as their income will be higher than unemployment benefits, which make up only about 60-70% of wages.

But in practice things turned out to be wrong. About half of the disabled are young people who earned low wages during the crisis and worked in the hospitality, food and services sectors. The gap between the wages they received and unemployment benefits was not significant, so to encourage them to return to work the state had to decide on grants for all returning to work. .

despite many criticisms voiced about the program, she was accepted in its current form, far from the outline of Spiegler and what Katz and Netanyahu promised.

MKs Anat Kanfo

even said at the time: "A person needs 800 psychometrics to understand what he is getting here, as if writing so as not to give anything.

"

Knesset members present at the consultation of finance ministers in the Labor and Welfare Committee before approving the plan

.

The committee's chairman, MK Haim Katz

, then told the finance officials: "You will be large with small money and you will earn."

Meir Spiegler, CEO of the National Insurance Institute. It turns out that the Treasury does not understand psychology (Photo: Reuven Castro)

Spiegler: "The Treasury did not leave the mental fixation"

The director general of the National Insurance Institute, Meir Spiegler, says in a conversation with Walla! That "the outline does not inspire the least. I meet people and they tell me we do not understand what we are supposed to get. Once a person has to do a mental arithmetic and start exercising a viability consideration it is not good. "

Spiegler adds:" I waged a struggle against the budget department in the Ministry of Finance, but they failed to get out of the mental fixation and understand that in economics there is also human psychology. If the outline we pushed for had at the end of the day the approval of the Labor and Welfare Committee, I have no doubt that the number of people returning to the labor market would have been immeasurably higher than the current one. "

Spiegler is not optimistic about the continuation:" What will happen is more and more plans. After so many plans the people no longer believe in the present plan, and are waiting for the next plan. I always said that if it is not simple, it simply will not be, "he concludes. The

Ministry of Finance responded:

"The grant program to encourage the return of the unemployed to the labor force is part of the general policy of returning workers to the labor market. The program has yielded significant achievement in recent months and data show it. 24,000 people were re-employed during March-April, which without the grant would not do so. This positive will continue. "

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