Israel’s Finance Ministry is advancing a plan to cancel the current discounts on National Insurance and health payments for yeshiva students and university students, aligning them with the full rate paid by non-working adults. According to a Channel 12 report, the monthly payment would rise from 171 shekels to 266 shekels, the same amount paid today by every working-age citizen without employment.
The proposal follows a recent State Comptroller report by Matanyahu Englman on preparing for an aging population. That report warned that the National Insurance Institute faces a deep actuarial deficit and could run out of money by 2035, nine years earlier than previous estimates, largely because long-term care spending has surged to 21 billion shekels a year.
Finance Ministry officials estimate that ending these discounts would improve the National Insurance Institute’s balance by about 1 billion shekels annually. Still, professionals acknowledge the move alone will not solve the structural crisis and is only one of several preventive fiscal steps now being considered. The ministry also cites long-term demographic change, noting Israeli Democracy Institute data that the ultra-Orthodox population is expected to grow from about 12% in 2020 to 20% by 2040.
The plan builds on a National Insurance Institute decision earlier this year to cancel the discount for draft-age yeshiva students who had not resolved their military status with the IDF. The new measure would go further and apply a permanent, blanket cancellation to all yeshiva students and students nationwide, regardless of military service obligations. Ultra-Orthodox representatives are sharply critical, calling it an economic persecution campaign and another set of punitive measures, alongside daycare issues and cuts to yeshiva budgets, while the ministry and economic groups describe it as a necessary step toward civic equality and future social security stability.
