Treasury official: Draft law will cost economy dearly

Yogev Gardos  credit: Ministry of Finance Spokesperson's Office
Yogev Gardos credit: Ministry of Finance Spokesperson's Office

Budgets Commissioner Yogev Gardos warns that the government's bill will push haredi men to stay in yeshiva.

Ministry of Finance Budgets Commissioner Yogev Gardos warned yesterday that the government’s conscription bill in its current format would have severe economic consequences. The government is due to discuss the bill tomorrow. In a professional position paper sent to Minister of Finance Bezalel Smotrich, Gardos wrote, "The arrangement presented in the expected decision will not lead to the required increase in conscription of haredim, and is liable at the same time to make the damage to the economy even heavier."

In his paper, Gardos calls for the mechanism of an age at which haredi (ultra-Orthodox Jewish) men studying in yeshivas (institutes of higher rabbinic learning) become exempt from military service to be abolished entirely. Under the bill, the exemption age will rise from 26 to 35. "Unless the mechanism of the exemption age is abolished and the number of those serving in the IDF Is expanded, with an emphasis on service that benefits security, the burden on the population that does serve will grow substantially, both from the point of view of length of service in the regular army and in the reserves, and from the point of view of the economic burden imposed on this population. In the light of projected demographic trends, the long-term damage liable to be incurred if the principles outlined above are not implemented cannot be overstated," Gardos writes.

"Setting an exemption age, particularly a high exemption age, pushes the young haredi man to remain in the yeshiva rather than become integrated into the labor market. The use of this provision or anything like it represents a reversion to past mistakes that have led the economy and society in Israel to pay a double price. As far as security is concerned, the number of those conscripted from the haredi community is not more than a few thousand annually, and in practice the vast majority is given a complete exemption. As far as the economy is concerned, making non-conscription of haredim conditional on their non-participation in the labor market has, as mentioned, led to employment patterns that cause long-term damage to the economy as a whole," Gardos adds.

NIS 41 billion cost

The renewed discussion of the conscription law comes at a time when the IDF has to rebuild its forces for the coming years and expand them considerably. In a paper drafted in the Budgets Division, the cost to the state budget of extending compulsory and reserve service to the degree required over the next decade will be NIS 41 billion.

"If those who now have the status of ‘Torah is his vocation’ were conscripted to an extent similar to conscription in the non-haredi Jewish population, it would be possible to shorten the period of compulsory service by seven months for everyone," Gardos writes. He adds that bringing haredim into the army would make it possible to reduce the number of days reserve duty by all reserve soldiers to about 86% of current numbers. "So, for example, a reserve combat soldier expected to serve six days on operational duty would, if this population were conscripted, serve only five days."

Conscription of haredim would reduce the economic costs, given that the alternative is extending reserve duty. "It is stressed that answering defense needs with soldiers doing regular compulsory service while reducing reserve service has very high economic significance, estimated at NIS 1.7 billion annually, since this alternative will hugely reduce the cost of army service to the economy," Gardos writes.

Published by Globes, Israel business news - - on March 25, 2024.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2024.

Yogev Gardos  credit: Ministry of Finance Spokesperson's Office
Yogev Gardos credit: Ministry of Finance Spokesperson's Office
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