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Wednesday, February 3, 2016
The Five-Year Plan to Integrate the Arab Population in Israel: A Quantum Leap Forward?

The Five-Year Plan to Integrate the Arab Population in Israel: A Quantum
Leap Forward?
INSS Insight No. 792, February 2, 2016
Meir Elran, Eran Yashiv
http://www.inss.org.il/index.aspx?id=4538&articleid=11389

SUMMARY: On December 30, 2015, the Israeli government unanimously adopted a
five-year plan (2016-2020) for the Arab population, estimated at
approximately NIS 15 billion. If implemented with reasonable effectiveness,
the program can serve as a solid foundation for a genuine improvement in the
socioeconomic condition of Israel’s Arabs, allowing for the proper
integration of one fifth of the nation’s population into Israel’s
productivity enterprise. This might have a major positive impact on the
country's GDP. Implementation of the program will also increase equality
between the sectors, improve the sensitive relations between the different
population segments, reduce the alienation between Jews and Arabs, and
improve personal security and public order. The strategic opportunity
inherent in the full realization of the program justifies its unconditional
support, the incorporation of the Arab leadership into its implementation,
and the government’s firm commitment to it.

On December 30, 2015, the Israeli government unanimously adopted a five-year
plan (2016-2020) for the Arab population, estimated at approximately NIS 15
billion. The program, which addresses many areas, is built on changes in the
current budget allocation mechanism for the Arab minority, so as to ensure
enhanced equality. The Ministry for Social Equality will be in charge of
implementing the program, together with the budget division of the Ministry
of Finance, and will chair an inter-ministerial steering committee that
includes representatives from all the involved ministries. The chairman of
the council of Arab local authority heads will also be invited. Most of the
budget earmarked for implementation of the program is already integrated
into the 2016 budget; the rest will require the approval of the Knesset
Finance Committee.

The most significant parts of the program include:

a. Education: Special emphasis is being placed on teacher training and
professional development, learning achievements, and expanded informal
education. The Ministry of Education is to formulate specific goals for
improving students’ command of Arabic and Hebrew and increase the rate of
those passing higher level mathematics matriculation exams. In higher
education, steps will be taken to increase the percentage of Arab students,
so that by 2021 they will represent 17 percent of undergraduates, 12 percent
of graduate students, and 7 percent of doctoral candidates. The budget for
the education programs is not specified in the government decision, but the
existing differential budgeting system might possibly ensure the necessary
allocation of funds to the Arab communities.

b. Employment: Fifty percent of budgets for various employment tracks
will be transferred to populations whose rate of participation in the
workforce is low, so as to incentivize employers to hire minorities while
bestowing preferential status for women and Bedouins. In addition, at least
25 percent of the annual allocation for building daycare centers will be
guaranteed to minority communities, thus increasing daycare options. Some 20
percent of the base budget of the Small and Medium Business Agency will be
allocated to minority groups, and further resources will be transferred to
encourage small and medium sized businesses in Arab towns.

c. Accessibility: The goal of equality in public transportation has been
re-affirmed. Consequently, 40 percent of funds for additional public
transportation services, or NIS 100 million – whichever is higher – are
allocated for the benefit of Arab towns, until the public transportation
coverage equals the national standards. The goal for complete equality in
transportation accessibility between Jewish and Arab communities has been
set for 2022.

Principal Ramifications

a. Transformation in allocation mechanisms is perhaps the most
significant measure in the new program, and connotes a clear public
assertion by the Israeli government that it acknowledges the ongoing
discrimination in allocations to the Arab population and Arab communities.
The prominent objective of the program is that allocations to minorities
match those to the Jewish majority. These two components, acknowledgment and
change, essentially bespeak a fundamental political change that must be
tested over time. The fact that the program was adopted by the current right
wing Israeli government, in the midst of yet another time of rising tension
between the Jewish and Arab populations, reflects awareness that improving
the conditions of the Arab population is an economic and social interest of
both the minority and majority. This understanding, which has been
promulgated by prominent Israeli leaders – chief among them President Reuven
Rivlin – emphasizes that strengthening the Arab population (as well as the
ultra-Orthodox Jewish community) is critical to Israel’s economic
prosperity. The support for this position from both politicians and
professionals, especially within the ranking functionaries in the Treasury
and other government ministries, can help ensure the program’s fulfillment.
Amir Levy, the head of the budget division within the Ministry of Finance,
and Ayman Saif, the director of the Economic Development Authority for the
Minorities in the Ministry of Social Equality were the primary movers behind
the program. Their continued involvement and commitment is essential for the
success of this bold move.

b. The financial aspect: It is possible to understand the current
decision in different ways. One is to focus on the profound change in
policy, based on the unprecedented scope of the program, more than 20 times
larger than previous five-year programs for the Arab sector. The present
plan represents 1.3 percent of the entire annual national product, even if
the total future expenditure will be less than NIS 15 billion over five
years. The other perspective suggests that the program amounts to little
more than setting a different pattern of allocation to the Arab public
commensurate with its part in the population, representing an affirmative
action without a comprehensive enlargement of the overall budget, which
opens the way to limited to non-implementation. In fact, as of now, the
program does not add a shekel to the approved budget.

c. Implementation: This is not the first comprehensive government program
for the Arab population. Like the one formulated during Ehud Barak’s tenure
as prime minister, which was only partly implemented, it is possible that
the new program will have a similar outcome, particularly given the number
of conditions that were attached to it. The most conspicuous condition
relates to the housing sector: the Prime Minister has made implementation of
this segment conditional on the enforcement of the laws regarding legal
construction and building of multi-story housing in the Arab communities.
The real meaning of these conditions is still unclear, and may be used as an
excuse for lesser implementation. In addition, placing the double
responsibility on the Ministry for Social Equality and the Ministry of
Finance on the one hand, and the designated ministers, on the other, will
not make it easier for the government to implement the program in full.

d. Economic implications: The multi-system approach to the different
fields in the program is welcome, as the economic and social challenges of
the Arab public are indeed multidimensional and interdependent. However,
success will depend on the scope of investment, as well as on the
effectiveness of the implementation of the different parts of the program,
which necessitate setting clear goals and benchmarks. There are numerous
obstacles to real improvement toward equality; some of them are associated
with the bureaucracy, and others are cultural and political issues within
the Arab sector. Still, if the program comes to fruition and is effectively
implemented, even in part, it stands a real chance of a major positive
transformation not only within the Arab sector, but in the country as a
whole. Similar perspectives should be applied to the ultra-Orthodox Jewish
community, which together with the Arab sector will soon represent close to
50 percent of Israel’s population.

e. The political environment: The decision to approve the new five-year
plan initiated and vigorously promoted by the professional echelons is only
the first important step in the right direction. Despite the growing
recognition that it represents a significant boost to the Israeli economy
and internal security, it is bound to face many obstacles in the future,
including political challenges. Here the role of the Arab leadership will be
most instrumental. The positive and moderate approach of most of the Arab
members of Knesset, under the fresh leadership of MK Ayman Odeh, who was
personally involved in the program’s formulation, and of the Arab local
leadership, is a critical element. These figures represent the attitude
among the majority of the Arab population, as evidenced by the findings of
the recent public opinion poll undertaken by INSS among Israel’s Arab
sector. Sixty-nine percent of the respondents said that equal rights for
Arabs is the primary issue for them, compared to 30 percent who said that
finding a solution to the rights of the Palestinian people was most
important. A more cynical theory on the approval of the new program might
suggest that the ministers realize that they still have a major leverage on
its actual implementation, and as there has been no increase of the overall
budget, they will be able to manipulate the allocations according to their
political preferences. Clearly, the program’s fate in future years will
largely depend on political considerations, and here the Prime Minister's
commitment to its full implementation is the most important component.

If implemented with reasonable effectiveness, the program can serve as a
solid foundation for a genuine improvement in the socioeconomic condition of
Israel’s Arabs, allowing for the proper integration of one fifth of the
nation’s population into Israel’s productivity. This might have a primary
positive impact on the country's GDP. Implementation of the program will
also increase equality between the sectors, improve the sensitive relations
between the different population segments, reduce the alienation between
Jews and Arabs, and improve personal security and public order. The
strategic opportunity inherent in the full realization of the program
justifies full, unconditional support for it, the incorporation of the Arab
leadership into its implementation, and the government’s firm commitment to
it.

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