Finance ministry will increase spending in the face of the Corona crisis by NIS 15.6 billion

The Treasury has circulated a memorandum of law that will increase spending in the face of the Corona crisis by NIS 15.6 billion.
The same extension is intended to fund the grants to encourage NIS 6 billion in employment, which was agreed to be distributed as a result of the retail chains' protest as well as the establishment of a dedicated loan fund for risk-averse businesses that were refused by the banks.
The fund will receive a larger state guarantee and will provide NIS 5 billion in loans. According to the Accountant General's Budget Report, NIS 20 billion has been paid to date in the aid package, of which only NIS 7 billion comes from the budget.
The addition is also expected to fund the $ 750 million vendor credit insurance loan, which has already been approved by the Finance Committee and the expansion of the Small and Medium Business Loan Fund from NIS 8 billion to NIS 14 billion.
The Ministry of Finance notes that the addition in question, which also includes budgetary additions to the government ministries, alongside the increase in the Small Business Fund, will increase the total aid package from NIS 80 billion to NIS 100 billion.
Since the budget for 2020 has not been approved so far and the actual budget is the continuation budget based on the 2019 budget, this is a significant deviation in the budget, which will eventually manifest itself as an unprecedented deficit.
It is estimated that at this stage the deficit will be above 11% at the end of the year, the remainder due to the deficit at the end of 2019 being high and stood at 3.7% following Netanyahu's steps and as a window.
The Ministry of Finance announced that it will allocate another NIS 6 billion "for the retention and return of workers to the employment cycle. At present, there is no model for allocating the same budgetary framework for businesses, but it is actually grants to companies and large chains that have put heavy pressure on politicians to grant them grants as small businesses receive. The announcement was made jointly with the Prime Minister's Office. It is estimated that these are grants of between millions and tens of millions of shekels. The Finance Ministry is attacking the same demands made last week by Prime Minister Netanyahu and the departing Finance Minister Moshe Kahlon, claiming that the large chains are ignoring the large amount of assistance they have received so far - the three-month exemption, which is very significant for small businesses; The option of taking all those employees on vacation without pay knowing that they will receive unemployment benefits under relatively favorable conditions, as well as the State Guarantee Fund for large businesses, which provides a 75% guarantee for business loans with turnover of over NIS 200 million affected.
The Treasury will also allocate NIS 4 billion to a venture fund designed for small businesses at risk, with the total guarantee to the fund being 40% -50%. This emerges from a summary reached between Finance Minister Moshe Kahlon and the Chairman of the Provisional Finance Committee MK Oded Forer.
Establishment of the fund is scheduled to be approved by the Finance Committee this Tuesday. Kahlon and Furer concluded that at the same meeting, an additional NIS 6 billion will be approved for the aid package that was promised to encourage employment due to retail pressure.
Their business for the New Loan Fund is business that was probably eligible for loans, but the restrictions due to the Corona crisis have brought them to such a level of risk that they do not allow them to take out loans from the banks.
In the Accounting Division, we had already planned over two weeks ago to build a NIS 2 billion route for those businesses, such as restaurants or event halls, but so far the outline has stuck. Now, according to the summary, the amount of the deposit - the total amount that the state will cover in case of non-compliance with loans will increase from 15% to 40-50%.