Knesset Votes Itself Out of a Raise

YERUSHALAYIM -
The Knesset plenum between sessions. (Oren Ben Hakoon/POOL)

Members of the Knesset voted on Monday night against an impending raise in salary on January 1.

The MKs wages are adjusted (usually upward) at the beginning of each year, in accord with the average national salary. A considerable raise—of NIS 6,500 ($1,900) per month—would have taken effect automatically, as the average salary rose this year, due to many low-earning workers being laid off during the pandemic.

Following the 39-0 vote, their salary will remain at NIS 45,000 ($13,400) a month.

Also on Monday, the Finance Ministry proposed batting down the average salary across the board. In a memorandum for the Average Salary Law, the Ministry recommended that following publication of the average salary on January 1, 2021 by the National Insurance Institute, a freeze be imposed on the official average salary.

The measure, if approved, would have broad ramifications in the economy, as many items are tied to the average salary, among them, payments to the National Insurance Institute, and municipal tax and electricity rates.

Ministry officials said they want to prevent a situation in which the population that is not influenced by the average salary, will not only be harmed by the rise, but also suffer a fall in their purchasing power.

If the freeze is not enacted, the Ministry estimates that the rise in the average salary would cost the state between 7 and 9 billion shekels.