Israel’s Finance Ministry is advancing a plan to cancel discounted National Insurance and health contributions for yeshiva students and university students, amid concern over the long-term finances of the National Insurance Institute. If approved, the monthly payment for these groups would rise from 171 shekels to 266 shekels, matching the rate paid by people who do not work in Israel.
The move comes after outgoing State Comptroller Matanyahu Englman warned on Sunday that the National Insurance Institute could face financial collapse within less than a decade. According to his report, long-term care spending has jumped from 7 billion shekels a year in 2018 to 21 billion shekels in 2025, a trend he said could push the agency into a cash-flow deficit by 2035 and prevent it from paying full legal benefits.
Finance Ministry officials acknowledge that ending the discounts for students and yeshiva students will not be enough on its own to prevent the projected collapse, but they say it could improve the institute’s balance sheet by about 1 billion shekels a year. The ministry is also conducting a broader study to identify additional solutions to the crisis.
The National Insurance Institute has already begun removing a separate discount for yeshiva students who did not regularize their status with the military authorities, with the change being phased in during the first quarter of 2026. The new Finance Ministry plan goes further, seeking to end the discount permanently for all students and yeshiva students, on the grounds that it is unjustified even aside from military service issues. Officials argue the step is increasingly important as the ultra-Orthodox population grows, noting a study by the Israel Democracy Institute based on Central Bureau of Statistics data that projects the Haredi share of Israel’s population will rise from about 12% in 2020 to 20% in 2040.
