Israel’s Finance Ministry is advancing a proposal to eliminate the discounted National Insurance and health insurance payments currently available to avreichim and university students, a move that would significantly increase their monthly payments.

According to a report by Channel 12 News, the plan would raise the monthly payment from NIS 171 to NIS 266, matching the rate currently paid by other non-working Israelis.

The proposal comes amid growing concern over the financial future of the National Insurance Institute. Earlier Sunday, outgoing State Comptroller Matanyahu Englman warned that the agency could face financial collapse within the next decade if reforms are not implemented.

According to the comptroller, long-term care expenditures have surged from NIS 7 billion in 2018 to NIS 21 billion in 2025. He warned that, at the current pace, the National Insurance Institute could enter a cash-flow deficit by 2035, preventing it from paying full benefits required by law.

Finance Ministry officials reportedly acknowledge that eliminating the discount for avreichim and students alone will not resolve the projected deficit. However, they estimate the measure would improve the agency’s finances by approximately NIS 1 billion annually. Additional reforms are also being examined.

The proposal follows a separate change implemented earlier this year, when the National Insurance Institute phased out discounted payments for avreichim who failed to regularize their military draft status.

The new Finance Ministry initiative goes further, seeking to permanently eliminate the discount for all avreichim and students regardless of their draft status, arguing that the reduced rate is no longer justified.

Treasury officials also point to demographic trends, noting that as the Chareidi population continues to grow, the cost of maintaining the discount will become increasingly significant. According to projections cited in the report, the Chareidi population is expected to grow from approximately 12% of Israel’s population in 2020 to roughly 20% by 2040.

(YWN World Headquarters – NYC)