As a Result of Adalah's Petition, Supreme Court Asks Ministry of Interior to Explain Inequality in Balance Grant Payments to Arab and Jewish Localities


On 4 June 2002, the Supreme Court held a hearing on a petition filed by Adalah demanding that the government reject the criteria currently applied by the Ministry of the Interior (MOI) to determine the distribution of balance grants, on the grounds that the criteria discriminate against Arab local authorities. The petition was filed by Adalah on 7 August 2001, on behalf of the National Committee of Arab Mayors, the Municipality of Nazareth and in its own name against the MOI, the Ministry of Finance and the Prime Minister. 

In its initial response to Adalah's petition, the state claimed that the policy of the MOI is to close economic gaps between Arab and Jewish localities. However, the state maintained, there are unique needs that exist only in Jewish localities, making it necessary to separate the allocation of balance grants to Jewish and Arab localities in the budget. The state cited religious councils, security, and the absorption of new immigrants as examples of needs that exist only in Jewish localities, and that place a heavier financial burden on Jewish local councils than on their Arab counterparts. 

Representing the petitioners before the Supreme Court, Adalah Staff Attorney Jamil Dakwar argued that the cost of the religious councils cannot be used as a pretext for unequal and arbitrary decisions in the distribution of balance grants, since the MOI can easily represent this amount in a separate budget item. Moreover, the costs of security and absorption of immigrants cannot be used to justify discrimination against Arab citizens, Adalah argued. Other government ministries, such as the Ministry of Internal Security and the Ministry of Absorption, provide financial assistance to Jewish municipalities to assist them with these costs. 

The purpose of balance grants, Adalah argued, is to assist local councils that have financial problems, in order to ensure a minimum standard of services for their residents. The criteria for the distribution of the grants should be socio-economic in nature. Therefore, the Arab local councils should enjoy the largest share of these grants, as Arab localities consistently rank lowest on social and economic indices. It is not formal equality that is at stake, Adalah argued, but rather substantive equality, which must take into account historical discrimination in budget allocation and the need for an affirmative action approach to closing the economic gaps between the Arab and Jewish communities in the country. Adalah supported its arguments by submitting an expert opinion written by Loay Alemi, a doctoral student at Tel Aviv University and an authority on local councils. 

The petition was heard by a three-judge panel, composed of Chief Justice Aharon Barak, Justice Eliyahu Mazza and Justice Yaakov Tirkel. The Court accepted Adalah's arguments and issued anorder nisi requiring the respondents to submit an explanation, within 45 days, detailing:
  • Why religious councils and guidance centers for local councils ('mafamim') should not be accounted for separately from balance grants in the budget;
  • Why there should not be a single budget item for the allocation of balance grants based on equal and objective criteria for all local councils.
H.C. 6223/01, National Committee of Arab Mayors, et. al. v. Ministry of the Interior, et. al.