Democracy
in the Shadow
of Coronavirus

NGOs are collapsing: “This is a national disaster that has come to our doorstep”

There is no one to fill this vacuum. More than 3,000 NGOs have already ceased operations and others are on the verge of shutting down, but the number of people who need to avail themselves of these services is greater than ever. The corona crisis is threatening to destroy the third sector, and the state is in denial.

Photos: Civic Leadership

Zeela Kotler Hadari

April 3, 2020

For the youngsters supported by Elem – Youth in Distress, these days are more dangerous than ever.  Some of them spend the night on the beach, others take shelter in temporary huts as they escape social isolation.  The boarding schools and institutions that normally look after these youngsters are closed because of the corona outbreak and they find themselves in clear and immediate danger.  Inbal Dor Kerbel, director of Elem, said: “Some of them roam the streets; there is an increase in sexual assaults.  The cases we see on the streets are much more extreme than normal and getting worse.  When social isolation began, these youngsters entered pressure cooker; their sense of being rejected increased, accompanied by suicidal thoughts.”

According to Elem, approximately 2000 youngsters aged 18–21 will become homeless within the next few weeks.  The occasional jobs they held have ceased, and they no longer have the money to pay rent.  “Who will be there to take them in?”  Dor-Kerbel asks, knowing the answer. The NGOs in the third sector have always been there to fill the enormous social vacuum that the state created.  But the NGOs are also in crisis mode due to the coronavirus that has pulled the already fragile rug from under their feet.  

“We were planning to hold a large fundraising drive after Passover, but we’ve cancelled it due to the collapse of the economy.  People are in survival mode, and the companies that match the funds we receive from the government for projects can no longer afford to help us. Our estimate is that we will see a 50% decrease in our income in the next three months, as compared to last year, while the number of people needing our services has increased.  We have put many of our social workers on unpaid leave and cut back on salaries, but it is not enough.”

Inbal Dor Kerbel, director of Elem – Youth in Distress: “Our estimate is that wewill see a 50% decrease in our income over the next three months, while thenumber of people needing our services has increased.”

Elem is a painful example of one of the 13,000 NGOs operating in Israel.  According to Civic Leadership, the umbrella organization for the third sector, 50% of these organizations have cut back on their operations and put thousands of employees on unpaid leave and 25% have completely ceased operations. This is just as horrifying in actual numbers, with more than 3,000 NGOs shut down right in the midst of a serious crisis and a real fear that they will not reopen if it continues.  One example is an organization that takes care of people addicted to drugs and alcohol who, all of a sudden, are left with no support system.  This is likely to exacerbate the sense of a pressure cooker that Dor-Kerbel was talking about.

The absurdity of it all is that, despite this situation, local authorities, the IDF Home Front, the Ministry of Social Welfare, and the Ministry for Social Equality have no qualms asking these same NGOs to help out in the corona crisis.

Dor-Kerbel:  “There are local authorities that have put their staff who are responsible for at-risk youth on unpaid leave and then give us lists of these young people and ask us to find them and help them out, because they aren’t out there helping them.  So, on the one hand, we are not getting any financial support and, on the other hand, it is the NGOs that are taking care of what is happening on the streets.  The community frameworks have also been closed down. It’s all coming out of our pocket and our resources are dwindling.”

There was enough money to fund three election campaigns.

Dwindling is a mild way of describing the situation.  In January, even before the word “corona” had become part of our lexicon and had cast a shadow of fear on every house in isolation in Israel, Civic Leadership had called on the Ministry of Finance to transfer to the NGOs the funding that was part of the 2019 budget.  The government had committed no less than NIS 450 million to the NGOs, but nothing had yet been paid because of the budgetary bottleneck in the various government ministries resulting from the caretaker government, the two rounds of elections in 2019, and the third in March 2020.  For elections there was money available in case you were wondering!

Michal Cohen, director of the Rashi Philanthropic Foundation, told us: “The government has got used to the NGOs stepping in and taking over. There is a notion that NGO's  are “nice to have” and will be the last priority in the survival game.  Now is the time for all of us to stop asking for charity, to demand that the government takes note of the third sector, and to take steps that are harsher than those with which we are usually associated. I don’t think the State of Israel lacks money. Civil society is not the fifth wheel.”

Dr. Hagai Katz, Ben-GurionUniversity: “Israel works according to this method: the state privatizes aservice, whittles down the payment to the NGOs that provide the service, andthen expects them to raise funds to make up the difference. When the NGOs havehad a certain success in raising funds, the state abandons them.”

Last Sunday, Civic Leadership organized an emergency Zoom conference with 450 participants.  Lior Finkel-Perl, the director of Civic Leadership, said: “We have reached an emergency situation.  When the NGOs collapse, hundreds of thousands of elderly people, at-risk youth, new immigrants, people with disabilities, and disadvantaged people will be directly harmed and there will be no one left to rehabilitate them.  We demand that 1% of the government’s total economic plan be allocated immediately to setting up a relief fund to give the third sector the air it needs to breath and survive.  We demand that NIS 1 billion be set aside for a relief fund and not a loan fund to help the NGOs keep their heads above water.”

The Ministry of Finance had a much smaller amount in mind – they were planning to give just NIS 200 million.  Finkel-Perl continued: “We have not yet been told all the details of the economic plan, but from the information we have received, the sum will only provide an initial, immediate response.”

How serious is the situation?

“There are 13,000 active NGOs in Israel, 3,500 of which receive contracts or direct grants worth NIS 20 billion per year from the government (NIS 17 billion in contracts and the rest in grants).  From what we know, in recent weeks, hundreds of contracts totaling NIS 2 billion have been terminated or reduced.”

“The Budgets Department of the Ministry of Finance formulated an economic plan to help the economy in the corona crisis, but it refers to the third sector without talking to us.  No one at the ministry spoke to any third sector organizations, which are already feeling battered by the ongoing budget crisis.  Government ministries are freezing contracts but expect the NGOs to continue operating as usual.”

It sounds like you are concerned.

“The NGOs are the pulse of Israeli civil society and work with the most disadvantaged sectors.  There is an incessant stream of calls for help, but government budgets are being halted without any warning, contributions are being directed toward hospitals and other places, and activities that would have brought income to the organizations have all ceased. The third sector employs 14% of all salaried workers in Israel and an additional 500,000 people volunteer on a regular basis.  If the current situation continues, the government will have to take back responsibility. This is a national disaster that has come to our doorstep and the heads of the Ministry of Finance need to get their act together, otherwise the third sector will collapse.  I am receiving thousands of calls for help.  The organizations distributing food report a very high demand and are not sure they will be able to keep up with it.  The social infrastructure that have we built up over many years will collapse and it will be very difficult, if not impossible, to rehabilitate it.”

Donations are not coming in, the disadvantaged are.

One of the NGOs that works round the clock in normal times and all the more so during the corona crisis is United Hatzalah.  Among its other activities, the organization operates an emergency hotline for humanitarian aid (1221) in conjunction with the Israel Association of Community Centers and One Heart.  The hotline is staffed by 30,000 volunteers who take thousands of calls every day.  Eli Pollak, the director of United Hatzalah, explained: “The calls for help are varied in nature ranging from assistance with shopping to helping an elderly person who has no hot water because the boiler is not working or who needs a lightbulb changing in the bathroom.  Some people even need help taking out the garbage.”

United Hatzalah operates the hotline alongside its regular activities.  “We have not put one employee on unpaid leave; quite the opposite – we have hired 50 new salaried employees and opened another 5 secondary hotlines.”  According to Pollak, in one single day this week, they dealt with 5,749 calls to the hotline: 992 were for general humanitarian assistance, 942 for help bringing home food and medications, 2,352 for help buying food and medications, 45 for personal care, 73 for emotional relief from loneliness, 8 for help walking pets, and 1,337 were requests for food.

Lior Finkel-Perl,director of Civic Leadership: If the current situation continues, thegovernment will have to take back responsibility. This is a national disasterthat has come to our doorstep, and the heads of the Ministry of Finance need toget their act together, otherwise the third sector will collapse.”

Like Inbal Dor-Kerbel from Elem, Pollak says that he too receives requests for assistance from local authorities, the IDF Home Front, and the Ministry of Social Welfare.  “I don’t respond in the negative to local authorities that contact us, but it is slightly ridiculous.  We are not asking for money but for help with protective equipment for our volunteers.  This is a huge expense and we have not received any funds at all from the government and not even one protective suit and we have to provide protective gear to our volunteers who are going to visit the elderly.  We are giving wholeheartedly to others but have unfortunately not yet received any help from the government.”

What about donations?

“Donations are dwindling, both in Israel and all over the world. Everyone is keeping their money close, fearful of the unknown.  In addition, United Hatzalah’s president, Eli Beer, who is in charge of fundraising abroad, sadly caught the Covid-19 virus and is currently hospitalized on a respirator in Miami and his condition is not good.  Our income has decreased, while our expenses have increased.”

Sova, an NGO that operates a soup kitchen in south Tel Aviv, also reported growing expenses in recent weeks after 500 new people were added to the list of regulars who come to the kitchen for a hot meal.  Gilad Harish, founder and director of Sova, said: “We are getting people who would not have come in the past, such as unemployed people or homeless people who would, previously, sleep next to restaurants and receive any leftovers from the owners, but now the restaurants are closed.  Many asylum seekers in south Tel Aviv have been fired from their jobs and don’t have any unemployment benefits, so they are also coming to us for help.”

How are you surviving?

“We have shut down many of our activities, except for the soup kitchen, and put some of our employees on unpaid leave.  As of today, our situation is stable.   We had plans drawn up for a rainy day, and so far we are continuing to operate.”

The state is in denial

Dr. Hagai Katz from the Department of Business Administration at Ben-Gurion University is not surprised by the difficult situation in which the third sector is finding itself.  Katz has been researching the third sector for many years and notes that it also suffered blows after the economic crisis of 2008 and the Second Lebanon War.  It is a ridiculous pattern that keeps repeating itself: those who are meant to work in full gear during a crisis are finding it difficult to survive.   Katz is currently conducting a joint study with Adv. Galia Feit of the Institute for Law and Philanthropy at Tel Aviv University about how NGOs are managing during the corona crisis and they plan to continue this study until June.  He can already report that in the past week, income from donations has slightly recovered and stabilized as has the number of volunteers. According to his figures, the percentage of people who made donations in the week of March 12–18, 2020 stood at 42% in comparison to the weekly average of 54% in 2019.

Eli Pollak, directorof United Hatzalah: “We are not asking for money but for help with protectiveequipment for our volunteers. This is a huge expense and we have not receivedany funds at all from the government and not even one protective suit.”

“The state needs to understand that the NGOs do not have the financial, organizational, managerial, or administrative means to take care of the full range of needs that are being seen during the current crisis.  If the state collapses and ceases to provide services – something we are beginning to see now and we saw during the Second Lebanon War – the most that the NGOs can do, even if they make a superhuman effort, is to touch the tip of the iceberg.  People continue working without a salary, but the third sector is, we must remember, tiny compared with the state as far as budgets and human resources are concerned.”

Will the organizations survive?

“For a very long time the state has not honored its financial commitments to these organizations and now, during this crisis, there is an immediate and intensive increase in needs.  There is no way that the NGOs can answer all these needs.  The state is in denial about this.”

He points out the pattern of creeping privatization that he sees. “The State of Israel works according to this method:  the state privatizes a service and then whittles down the payment to the NGOs that provide the service and expects them to raise funds to make up the difference.  At that point, when the NGOs have had a certain level of success in raising private funds, the state abandons them.  In this way, the state practices gradual and creeping privatization.”

Do you foresee Israel’s social resilience being harmed?

“It’s a question of ideology.  According to my ideology, we should, of course, be making creative arrangements to restore the welfare state to healthy dimensions.  However, others claim that the welfare state is an outdated concept and that market forces should be allowed to act.  However, even those who believe in the free market need to understand that as long as the situation is normal and the economy operates as it should, we can live with this situation, but it doesn’t work during a medical, social, or economic crisis.”

Does the third sector also need to learn some lessons?

“Most definitely.  Whoever has fat reserves will stay afloat in stormy waters.  But not everyone has reserves and certainly not when some of the organizations do not receive any government assistance.  In addition, the state doesn’t like the NGOs having excess funds.  The Income Tax Authority expects them to use up all the money they have every year and not to carry over funds to the following year, and they place sanctions on organizations that do so.  This is something that needs to change.”  

“This happens in the third sector because the state is suspicious of organizations being involved in money laundering or distributing money without transparency.  If you receive a donation, the state expects you to spend it.  However, in the third sector, NGOs that are not properly managed are a negligible minority.  If an NGO has one slice of bread, it will eat it and not keep it for tomorrow.   As of now, one quarter of the NGOs have already ceased operations, and this is just the beginning.  What will happen if this situation continues for another two or three months?”

Response from the Ministry of Finance:

“As part of the economic plan that has been formulated, many steps have been taken to help organizations in the third sector. These include a relief fund worth NIS 200 million to enable the NGOs to continue their activities and to support their organizational infrastructure,  a cancellation of municipal taxes, a postponement of other taxes, state-guaranteed loans, and other regulatory and bureaucratic mitigation measures.”

“In addition, many NGOs are working together with government ministries during the corona crisis and are being funded accordingly by the government.  We are working nonstop to help organizations in the third sector and civil society get through this period and hope for a rapid return to normal.”