The Histadrut published its position regarding a series of structural measures included in the draft Economic Arrangements Law for 2026 on Sunday, emphasizing that some of the proposed clauses may harm workers’ rights, public safety, and the functioning of essential systems in the country.
The Economic Arrangements Law is a piece of legislation that is brought to the Knesset annually alongside the budget and combines a wide array of legislative adjustments pertaining to different, sometimes unrelated, economic issues into a single proposal.
In the initial document prepared by the Histadrut’s Trade Union Division and submitted to the Ministry of Finance, the Histadrut warned of an expanding trend of privatization in infrastructure and essential services. Alongside opposition to broad structural reforms, the Histadrut also expressed support for targeted measures intended to strengthen employment and regulate unused assets.
“We are in favor of innovation and efficiency, but not at the price of uprooting essential infrastructures from the public’s hands and gambling on the future of Israel’s citizens,” Adam Blumenberg, head of the Histadrut’s Trade Union Division and vice president of Economics and Policy at the Histadrut, said. “If the government chooses to advance reforms based on data, balance, and responsibility—we will be the first partners, as we know how to be. But if we see attempts to push through hasty moves whose sole purpose is to lead to uncontrolled privatization, we will not stand aside and we will defend the citizens and the workers in particular.”
Israel Railways—resolute opposition to privatization
The Histadrut expressed firm opposition to the government’s proposal to transfer maintenance and operation services of Israel Railways to private entities. According to the Histadrut, the proposal relies on an incorrect factual basis and ignores consistent improvement in punctuality and reliability indicators in recent years. Past experience in Israel and worldwide shows that privatizations of this kind led to increased expenses, a decline in technical fitness, and harm to the level of service to the public.
The Histadrut added that privatization would harm accumulated professional knowledge, encourage contractor-based employment, and burden operational continuity in emergencies. “Railway workers have demonstrated an ability to function under fire and rockets—foreign companies have not withstood this,” the Histadrut wrote.
Privately operated airports—concern for harm to security and oversight capability
The Histadrut warned that transferring airports to private bodies will weaken oversight and create a link between profitability and safe operation. “The proposed law allows operation by a franchisee with a commercial interest—a model insufficiently regulated in times of crisis,” it wrote.
“No operational justification” for promotion of Hadera and Ashkelon ports
The Histadrut argued that there is no data justifying the establishment of new ports, stating that proof is required of utilization of at least 90% of current capacity over an extended period before port expansion is warranted. (Small ports currently exist in the coastal cities of Hadera and Ashkelon, currently used nearly entirely for energy purposes. The Arrangements Law draft suggested promoting fully functioning ports in those cities.)
The document also stated that transferring professional activity away from the Electric Corporation and from the Eilat Ashkelon Pipeline Company will cause a loss of operational knowledge accumulated over decades, harm continuity of energy supply in emergencies, and create safety risks.
The dairy sector—harm to local production and food security
The Histadrut also expressed its opposition to canceling quotas and expanding imports in the dairy sector. The share of raw milk in the consumer price is low, estimated at only 10%–15%, and therefore regulatory changes may not lower prices for the public. Deregulation is expected to harm small dairies and employment on Israel’s periphery and increase dependence on imports during times of crisis.
Local authorities—concern for cutbacks and harm to services
The Histadrut warned that tightening the formula for “balance grants”—grants to local authorities intended to prevent budget deficits— may lead many authorities to extensive cutbacks and harm areas of education, welfare, and community services. It made similar critiques regarding the City Tax Fund, known in Hebrew as the Arnona Fund, which is intended to redistribute commercial real estate tax among all Israeli municipalities in order to promote building new housing.
Critics of the proposed Arnona Fund argue that it penalizes those municipalities that have worked to promote the industry and business sector, which are not necessarily home to wealthy individuals.
Widening tax brackets—expected to benefit the rich despite claims of helping the middle class
The Histadrut emphasizes that seeing as the public sector was the first to suffer from earlier decisions to tighten the budget, it also ought to be the first to benefit from potential tax adjustments.
Integrating technologies to improve public service—poorly executed
The Histadrut noted that implementing the proposed amendment grants overly broad powers to the Digital Directorate and to the Budget Commissioner, who “will effectively become the Civil Service Commission” with regard to managing staffing and examining manpower needs in the government. In addition, the proposal allows the Digital Directorate “to conduct an examination of technological alternatives even without a request to increase manpower,” thereby granting it the ability to intervene professionally in the existing staffing structure, even when there is no justification or clear operational need.
The Histadrut further emphasized that the timelines and consultation requirements may delay improvements and create bureaucratic burden, contrary to the goal of the reform.
Beyond the issues detailed above, the Histadrut’s document includes dozens of additional clauses relating to the National Insurance Institute (known in Hebrew as Bituach Leumi), regulation of disabled parking, the stability of the tourism system, emissions pricing, revenue-sharing arrangements between hospitals and health management organizations (known in Hebrew as kupot cholim), and more. All sections contain one consistent demand: transparent public discussion and ensuring a safety net for workers and essential services—before any structural changes.
