Public transit fares are set to rise by 2 shekels (about 54 cents) under Israel’s 2025 budget as the result of significant reduction in the state subsidy. This comes as part of extensive cuts in the budget outline presented by right-wing Finance Minister Bezalel Smotrich to deal with the large deficit brought about by the war.
The new budget was accepted by the cabinet on Friday and is now on its way to the Knesset for approval.
“We all have the duty to contribute to the war effort. The Ministry of Transport made a significant contribution to the war budget, at the same time as achieving an important budget agreement for 2025, which includes plans to reduce congestion, expand public transport use, and connect the State of Israel,” Transport Minister and Likud member Miri Regev said of the plan.
Prices Rose Without Public Notice
When asked about these government’s budget cuts, Regev said that the price of public transit in Israel should be considered in comparison to the OECD average. Indeed, Israel’s public transit is relatively cheap for the user. However, in most developed countries public transportation is more extensive and reliable than in Israel, so even if Israelis pay a similar price to their OECD equivalents, it will be in exchange for a poorer service.
According to Regev, the money saved as a result of the cut will be invested in improving services and in expanding her “Transport Justice” reforms, which are aimed at lowering transit prices for disadvantaged populations. This reform replaces a similar program put in place by the previous minister, Labor MK Merav Michaeli.
Unlike Michaeli, Regev is not subsidizing the transport price increase. Thus, in July the prices of public transportation jumped by 5%-10%, including an increase of 1.5 shekels (40 cents) for bus rides and an increase of 2 shekels (54 cents) for light rail rides spread across one increase by 0.5 shekels (13 cents) and a later increase by 1.5 shekels (40 cents). This was all done without the Ministry of Transportation notifying the public.
In July, Economic Affairs Committee Chair David Bitan reacted angrily to the Transport Ministry’s intention to raise the light rail travel fare by 2 shekels. During a discussion in the Committee, Bitan claimed that the Finance Ministry had performed a “trick” in the calculations to raise the price, making it higher than it should be according to the pricing mechanism established by law.
Bitan expressed his frustration with officials from the Finance and Transport Ministries, demanding a freeze on the price increase and the cancellation of the policy whereby bus fares are rounded up. Bitan’s proposals have not progressed since that discussion.
Slashing Public Transport, Promoting Car Travel
Regev also claimed the budget will allow the ministry to continue promoting larger projects.
Among other things, she said that metropolitan transportation authorities will be established—a concept which has long been popular in the field but has not progressed. Metropolitan transportation authorities are intended to represent the transportation needs of multiple municipalities within a specific geographic area with a large population with representation for each municipality according to its size, in order to improve transport planning.
According to the latest drafts of the Arrangements Law—the omnibus bill of reforms submitted alongside the budget—metropolitan transportation authorities will initially be established in the metropolitan area of Haifa and of Tel Aviv, with plans to eventually establish authorities in Jerusalem and Be’er Sheva.
Regev also committed to continue work on an expansion of the northern section of Highway 6 and to move forward with a similar expansion in the south. These infrastructure projects are carried out using a form of public-private partnership known as build-operate-transfer, meaning that they will not account for significant state investment of capital.
At the Economic Affairs Committee hearing earlier this week, MK Bitan demanded that the government subsidize a discount for residents of the north who travel on Highway 6’s new northern section. He and the other members of the committee were unable to reach an agreement with the finance officials, and the meeting was closed without progress after half an hour of heated discussion.
There is also a renewed commitment to invest in redesigning dangerous roads, particularly Highway 40 in southern Israel. In recent weeks, several fatal accidents have occurred on this road, one of which injured an entire family. After a persistent struggle by residents in the Mitzpe Ramon area, the government promised to invest in repairing the dangerous road, but so far there has been no change in the situation.
The Ministry of Transport did not respond to Davar’s question as to whether additional cuts were implemented in the National Road Safety Authority.
The ministry also promised to reduce the cost of tolls on two sections of Highway 6. Critics say this plan reveals that the government is more willing to subsidize private cars than public transit. What’s more, according to an OECD report and the consensus among economists who deal with the issue, encouraging private cars and harming public transport simply transfers more passengers to car travel—thus causing more congestion and traffic jams on the roads. So even if Israelis pay less to travel on a highway, they may end up spending more time than ever sitting in traffic.
This article was translated from Hebrew by Hannah Blount.
