New data collected by Israel’s National Insurance Institute reveal that about 20 percent of the country’s seniors – some 185,000 people – are officially poor and live on stipends and income supplements alone.

The findings, released on Jan. 4, said that Israel ranks 24th among the 34 member states of the Organization for Economic Cooperation and Development,  which it joined in 2010.  The organization’s member states have an average poverty rate of 15 percent among senior citizens. By comparison, the official poverty rate for seniors in the United States is about 10 percent.

The survey was conducted by Dr. Daniel Gottlieb, Israel’s national insurance deputy director of planning and research , and Miri Andeblad, economic department head. It shows improvement compared with Israel’s ranking in 1997, when it ranked 50th of 50 countries examined.

Israel is showing a positive trend over the past 15 years: From a 27 percent poverty rate among seniors in 1997, to 22 percent in 2005 and 20 percent in 2012. “But we still have a long way to go,” Gottlieb stressed.

“On the one hand, we must increase and improve the stipends in order to reach the OECD average. And on the other hand Israel’s main problem is the large immigrant population: They immigrated to Israel late, didn’t save enough or at all, and weren’t encouraged to save by the government until lately by new pension laws.

“These people are at a high risk for poverty. These are the people who will soon become completely dependent on National Insurance. Therefore, we must prepare a new plan.”

Gottlieb’s findings have been confirmed by other surveys. Similar findings were presented in the “Share Israel” conference held in October, according to which about 25 percent of Israelis over age 50 are officially poor and make less than half the median income for people their age.

The huge disparity between Israel and the first 10 countries in the OECD rankings further emphasize the problem: Israel’s poverty percentage is 11 times higher than the Netherlands’, which tops the list, and 7 times higher than the runner-up’s, Luxemburg.

What does the future hold?

Dr. Igal Ben Shalom, the former director of the National Insurance Institute and current vice president of the International Fellowship of Christians and Jews, headed by Rabbi Yechiel Eckstein, said that the solution is all about the “right proportions,” and that Israel requires a “wide system overhaul,” if seniors 20 years hence are to enjoy a proper pension. The overhaul should include raising stipends, strengthening welfare services, and support from non-governmental agencies, he said. n

Ram Hadar is the CEO of Acovado, which specializes in project management and counseling in database optimization and analysis.