A wave of anger has escalated among settlers and business owners within the occupation's home front, due to the government's delay in paying financial compensation for losses resulting from the ongoing war. These protests come at a time when cities and settlements are still being subjected to successive missile strikes from Iran and Hezbollah, leading to a partial paralysis in wide economic sectors.
Economic sources reported that beneficiaries of the war compensation scheme will have to wait for many weeks before receiving any financial support. The Ministry of Finance is currently working on preparing the necessary legislative drafts to regulate compensation for workers and companies, a process that requires a long time for review and public comment before being referred to the Ministerial Committee.
Estimates indicate that funds will not reach their beneficiaries before next May, given the coincidence of legislative procedures with the timing of Jewish holidays and the anticipated Knesset recess. Despite the Ministry of Finance's attempts to deny any deliberate delay, bureaucratic reality suggests that payments will not be made soon, even if laws are expedited.
Observers criticized the slow timelines for preparing legislation compared to previous confrontations, such as the events of June 2025 or the start of the war on Gaza in October 2023. It appears that the current government faces difficulties in reconciling the preparation of the state budget with meeting the urgent needs of those affected by the ongoing military operations.
Israeli anger is particularly focused on the conditions of the compensation scheme, which is limited to companies that have lost at least 25% of their annual turnover. The current model aims to compensate only salary expenses and fixed costs, which major companies with budgets of millions of dollars consider insufficient to cover their actual losses.
Informed sources confirmed that the Treasury published the aid scheme without reaching final agreements with employers on fundamental issues. This confusion has led to a state of uncertainty in the market, where stakeholders fear continued financial bleeding without a clear and direct government safety net.
An additional crisis emerges concerning severance pay and unemployment benefits for employees who were forced to stop working during the first week of the war. The current model requires an employee's absence for 14 consecutive days to be eligible, which deprives those who return to work early of any financial compensation for their period of stoppage.
Shahar Turgeman, head of the Federation of Chambers of Commerce, warned that the current Finance Minister's policies contribute to suppressing economic growth instead of stimulating it. Turgeman considered that the current scheme encourages workers to stay at home for longer periods to ensure they receive unemployment benefits, which harms the overall productivity of the Israeli economy.
Official data revealed a bitter reality for the business sector, with approximately 170 companies closing daily in Israel for about two and a half years. These figures reflect the depth of the structural crisis facing the economy, which has sharply worsened with the outbreak of recent military confrontations and the expansion of the targeting area.
A recent survey conducted by the Bank of Israel showed that economic damage affected approximately 66,000 companies employing more than two million workers. The survey indicated that a quarter of companies in the Israeli economy are currently temporarily closed or operating at a minimum human capacity, signaling an economic catastrophe.
Although some companies reported a slight improvement in employment levels compared to previous rounds, only 44% of companies are operating at a normal level. This disparity indicates that vital sectors are still suffering from labor shortages or supply chain disruptions due to the deteriorating security situation in the north and center.
In a stormy meeting of business owners, the head of the Bar Association and the CEO of the Restaurants Organization expressed their dissatisfaction with the government's disregard for the demands of the private sector. The attendees affirmed that continued procrastination in paying compensation would lead to the collapse of more small and medium-sized enterprises, which form the backbone of the local economy.
Netanyahu's government faces increasing pressure to review compensation criteria and make them more flexible to include a wider segment of those affected. However, budget deficits and political complexities within the government coalition seem to prevent quick and decisive decisions to rescue the ailing economic situation.
In conclusion, settlers remain in a state of anticipation and anxiety about their financial future amidst the ongoing war and the absence of effective government solutions. The coming days remain crucial in determining whether the Knesset will be able to overcome bureaucratic obstacles to pay compensation before entering the long holiday recess.
Instead of generating growth, the Finance Minister is suppressing it, encouraging workers to stay at home to receive unemployment benefits.
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Compensation Crisis Haunts Netanyahu's Government: Anger Among Settlers and Expectations of Payment Delay Until Next May