Israel’s Prime Minister Benjamin Netanyahu has gotten a lukewarm reception from his main coalition partner and the head of the central bank to a plan to grant money to all Israelis to revive the economy during the coronavirus crisis.
Netanyahu announced the 6 billion shekel ($1.75bn) package on Wednesday amid public anger and protests over his handling of the pandemic
In a televised news conference, the right-wing prime minister lashed out at violent tactics used by some protesters and said his decision was not connected with the unrest.
Under the plan, which requires cabinet approval, individuals and households without children will receive one-time payments of just 750 shekels ($218), while families will receive roughly $600 to $900, depending on the number of children they have.
“This money encourages consumption, and it encourages employment,” Netanyahu said.
But on Thursday, Bank of Israel Governor Amir Yaron and Foreign Minister Gabi Ashkenazi, of the centrist Blue and White party that has partnered with Netanyahu’s Likud in the government, said the money should instead be targeted at the poorest citizens.
Professionals in the Ministry of Finance also opposed the proposal because it does not differentiate between the struggling and the well-off, Israeli media reported.
In an interview with Army Radio, Yaron said it was very important to help “but even more important to aid those in need. There are more effective ways to help increase demand,” he said, adding that more cash could be given to the unemployed.
Yaron had supported a previous 100 billion shekel ($29bn) stimulus package and a second one announced last week, even though they are expected to drive this year’s budget deficit up to 13 percent of gross domestic product (GDP). The economy is set to contract 6 percent in 2020.
Ashkenazi said on Army Radio that while he was not opposed to grants for Israelis hit by economic hardship, Blue and White would try to amend Netanyahu’s plan so that the money would go “to those who are hurting and not to those who don’t need it”.
Netanyahu said doing so would be too time-consuming.
The prime minister was domestically praised for his actions early in the coronavirus crisis after he moved quickly to seal the country’s borders and impose lockdown restrictions to contain the outbreak.
But after reopening the economy in May, there has been a sharp rise in infections. At the same time, unemployment has surged to more than 20 percent, while Netanyahu’s popularity has plummeted.
Polls show less than 30 percent of the public trusts Netanyahu’s handling of the crisis. Thousands took part in anti-Netanyahu rallies this week.
Israel has reported more than 44,000 confirmed coronavirus cases and 377 related deaths.