At the weekly Izraeli Cabinet meeting

1. Prime Minister Benjamin Netanyahu made the following remarks:

I would like to wish all ministers and deputy ministers, and all Israelis, a happy and healthy new year. I believe that this will be a good year, a very good year. I would like to wish you, Professor Manuel Trajtenberg and the members of your committee, a good year in the wake of the accelerated, serious and detailed work that you did in order to bring good news to Israel’s society. I know that you invested much of yourself, under complicated conditions, in opening a dialogue with the public, in achieving breakthroughs in so many new fields, as well as old ones that had not been dealt with for many years. I think that you did very, very important work.

We are going to devote the greater part of this meeting to discussing your committee’s important report. I believe that there is a change of direction here. Israelis need to know that we are changing the national order of priorities. We are making many social corrections for the benefit of Israel’s citizens, but we are doing so responsibly. The main mission before us is to lower the cost of living in Israel. This is the root of the distress affecting Israelis and this is what we are going to change and correct.

We are changing the national order of priorities in a wide range of areas including childcare for toddlers, lowering a series of customs duties, enacting tax corrections and cancelling tax distortions, increasing competitiveness for products and services for the benefit of the Israeli economy, increasing negative income tax, housing easements, etc. We will discuss these today and at future meetings until detailed proposals are submitted.

All of this will be done responsibly, without opening the country’s overdraft. If we do not act responsibly, we could certainly lead the state of Israel into the situation of many other countries that are on the verge of economic bankruptcy, the collapse of their social welfare systems and high unemployment. We will act differently. We will adopt the main points of the report and afterwards we will move forward with detailed recommendations. Our intention will be to make social corrections while maintaining economic responsibility. I think that Israel will thereby make a new breakthrough and be a symbol for many other countries vis-à-vis the direction to take.”

2. Deputy Minister for Senior Citizens’ Affairs Lea Nass presented data on the senior citizen population in Israel and on the care senior citizens receive in various areas in the context of the reform being led by the Ministry of Senior Citizens Affairs. She also presented the draft decision – which was subsequently adopted – on developing a master plan for senior citizens in the various local councils.

3. The Cabinet discussed the expansion of security – and the maintenance of public order – at educational institutions in order to deal with various threats.

4. The Cabinet discussed the allocation of job positions and budgeting to the Home Front Defense Ministry and the transfer of the Defense Minister’s responsibilities regarding national emergency economic planning to the Home Front Defense Minister. Click here for additional details.

5. The Cabinet began its discussion of the recommendations of the committee on socio-economic change chaired by Prof. Manuel Trajtenberg.

Prof. Trajtenberg briefed ministers on his committee’s report and modus operandi. The following subcommittee chairmen briefed ministers on the main points of their recommendations:

Prof. Eugene Kandel, chairman of the taxation subcommittee;

Dr. Shlomi Frizet, chairman of the cost of living and competitiveness subcommittee;

Gal Hershkovitz, chairman of the social services subcommittee; and

Amir Barkan, chairman of the housing subcommittee.

Bank of Israel Governor Prof. Stanley Fischer briefed the Cabinet on his position in support of the Trajtenberg committee recommendations.

The Cabinet will continue its deliberations at its next meeting.

6. Finance Minister Yuval Steinitz and Finance Ministry Acting Director-General Doron Cohen presented the main points of the report on economic efficiency that the Government is due to submit to the Knesset Finance Committee.