Israeli government unites under socio-economic goals

The Government of Israel has committed to increasing employment and decreasing poverty. The decision suggests rising influence for the Prime Minister's Office.

The Government of Israel is poised to incorporate two concrete socio-economic goals into the budget plan for 2008-2010:

  • Employment Rate Goal - Increase employment rate among the working age population from 69.1% to 71.7%, adding two hundred forty four thousand people to the workforce.

  • Poverty Goal - Increase the income of the poorest 20% of the population by 10% more than GDP per capita growth, adding 500 NIS per month to their earnings.

The establishment of these goals is an engine of growth - Two outstanding challenges facing the Israeli economy are the identification of its growth drivers and the realization of the economy's hidden potential. The Reut Institute defines an engine of growth as anything that increases either productivity or inputs to the economy (e.g. allocation of resources, changes in policy, culture, etc.). One opportunity for growth of the Israeli economy is increasing the relatively low participation rate in the workforce.1 Thus, the current policy that focuses on this challenge is a step towards a development leap.

The Prime Minister's Office is strengthening - The recently established National Economic Council enables the Prime Minister's Office to both promote initiatives and to cooperate on a professional level in the creation and design of socio-economic programs.

An emphasis on implementation - The way in which the socio-economic policy process was built improves the ability of various governing bodies to coordinate in order to achieve the government's policies:

  • Inter-Ministry agreement and cooperation during the design process - Collaboration in policy design, and not just implementation, builds agreement and trust.

  • Operative goals create motivation to implement the agenda - Translation of the agenda to operative terms provides political incentives to the various offices involved in implementation: they can either benefit from gains due to the success of the policy or bear the consequences of failure.

Sources

Basok, 6/8/2007, Haaretz, Full Article (Hebrew Only)

1 The goal set of a 71.7% employment participation rate is the OECD average for 25 - 64 year olds. See: The National Economic Council in the Office of the Prime Minister, "Goals for Socio-Economic Policy for Israel: 2008-2010" p. 10