On Tuesday, social activists from Yaffo spoke to the Knesset during a special session for the International Day for the Eradication of Poverty, drawing attention to the widespread nature of poverty and food insecurity and calling on the lawmakers to institute additional price control measures on healthy grocery store staples. Representatives from the coalition, the opposition, the Ministries of Health and Economy, the private sector, and nonprofit organizations all expressed their support for increased price control measures amid the cost of living crisis, but the representative from the Finance Ministry, which controls price controls, shut the idea down, claiming that price controls are “not an efficient tool for lowering prices.”
“I have seven children, and I work half time because of my husband’s illness. We’re nine people living on 10,000 shekels [a month, or about $2,800], and when I go to the supermarket I need to stick to a budget and choose only items on sale,” Liza Kuma, an activist with the progressive Ir Sgula organization in Tel Aviv, told the Knesset.
She said that by the 15th of the month, she often has run out of money and has to shop at the corner market on credit from the store owner. “As an activist representing many people who were unable to come here, I ask for you to impose price controls, at least on basic items like tuna, milk, cornflakes,” she said. “We Arab Israelis are going through a difficult period. Poverty in Yaffo has risen by 70%, and we’re being fired or not offered work because of our head coverings. If you, members of the Knesset, don’t help us, who will?”
Israel’s price control scheme currently covers specific types of bread, milk, cheese, eggs, and salt. The price control committee currently comprises representatives from the Ministries of Finance and Economy and sometimes the Ministry of Health. The authority to impose price controls sits in the Ministry of Finance, the economic outlook of which is that price controls lead to market distortions. That outlook has prevented additional items from being entered into the price control scheme in recent years.
Adi, another resident of Yaffo and social activist, told the Knesset it was difficult to discuss her situation so publicly. “To be honest, I’m embarrassed that I need to be here,” she said. “I have 14-and-a-half-year-old twins, I’m a teacher with a master’s degree, and I’m a single mother. I have no money to buy meat or fish. There are very few vegetables, and there’s one fruit in the house.”
She said that half her salary goes to rent for a dilapidated apartment. “Something in the system needs to change,” she said. “These days, being healthy is for the rich. Wages stay the same and the cost of living just goes up. It leads to illness and social disparities.”
The Ministry of Finance squarely rejected the idea of using price controls to combat poverty. “Price controls are not a tool for addressing food insecurity,” Ofri Eshel, head of the Ministry of Finance’s price committee, said. “If they’re used to address this problem, it’s very possible that the reverse will happen and the public will be harmed.”
Shalom Danino, sitting chair of the committee, expressed his frustration with the Ministry of Finance. “Your economic theories didn’t work,” he said. “This system and these economic models that you present time and time again—it doesn’t work. I’m asking that you not come here with preprepared notes. Say even that you’ll try a single product.”
Jonathan Bezalel, head of the Ministry of Economy’s budget division, noted that numerous other methods for decreasing the cost of living have already been implemented, including a significant reform on imports. “Price controls are the first-line response, but in the Israeli market, which is small and isolated, we need to use price controls intelligently in a way that won’t hurt the market,” he said. “The price control law already exists, which allows us to act without additional regulations, but we’ll need to influence the Ministry of Finance’s stance on the matter.”
Boaz Gur of the Arlozorov Forum called on the committee to do everything in its power to move forward with additional price controls. “The committee needs to take a drastic step: either change to be the cost of living committee in order to check what’s happening with the products that are price controlled, and we can raise the findings of the Ministry of Economy, or use its tool as a investigative parliamentary committee and investigate why price controls aren’t being used,” he said.
Dorit Adler, president of the Israeli Forum for Sustainable Nutrition, emphasized that food prices in Israel are the result of policy, not fate. “As a society, we chose to make education free. We’re not saying food should be free, but it’s the state’s responsibility to make healthy, sustainable food available to everyone,” she said.
This article was translated from Hebrew by Leah Schwartz.
