Government Panel to Explore Lowering Cost of Living


Just weeks after the passage of an austerity budget that threatens to send thousands of Israelis below the poverty line, a government panel to formulate policies to bring down the cost of living was established on Monday, The Jerusalem Post reported.

The inter-ministerial panel, also charged with generating ideas to remove trade barriers, will be led by Finance Ministry deputy budget director Yonatan Regev and Economy and Trade Ministry director Amit Lang. They will be working on a six- month timetable for submitting recommendations. They were appointed by Finance Minister Yair Lapid and Economy and Trade Minister Naftali Bennett.

The issue of trade barriers and prices are linked, as Israelis find themselves paying far more than Europeans for the same items.

The first proposal brought before the team would make it tougher for the state to impose levies on imports. But there are other causes for high prices as well. High levels of market concentration, information gaps, regulatory gaps, and exclusivity agreements and other issues reduce competition.

The various bureaucratic hurdles a business must overcome to operate in Israel are daunting. The World Bank’s annual Doing Business Index, which measures such things, lowered Israel’s rating by two places to 38 between 2012 and 2013.

On Sunday, the Agriculture Ministry’s price supervisor, Uri Tzuk-Bar, recommended that prices of 5% full-fat white cheese and 38% full-fat sweet cream should be regulated, and that their prices should be lowered significantly.

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