Discriminatory State Financial Support to Former Soldiers for Home Mortgages.

HCJ 11956/05, Suhad Bishara, et. al. v. The Ministry of Construction and Housing.

Petition submitted to the Supreme Court in 12/05 against the Ministry of Construction and Housing, challenging a governmental policy of providing substantial financial support in the form of low-interest governmental loans for home mortgages to Israeli citizens who have completed military or national service. This support supplements the already generous financial support awarded for housing and other benefits under the Absorption of Former Soldiers Law (1994). Adalah argued that the support for housing mortgage loans discriminates against Palestinian citizens of Israel, who are exempt from and generally do not perform military or national service. Adalah further contended that the performance of military service is irrelevant to the purpose of supplemental governmental housing support, which is to assist the socio-economically disadvantaged to find housing solutions, and that support beyond what is already provided by the 1994 law therefore violates the Ministry’s declared purpose.

In Israel, home mortgages are comprised of low-interest government-financed loans and higher-interest bank-financed private loans. Eligibility for government-financed loans is calculated based on a points or credits system assigned for various personal factors such as the number of siblings, the number of children in the household, any health-related disabilities, and an individual’s socio-economic situation. Under current governmental policy, one of the main factors taken into consideration, which yields a great number of points or a lack thereof, is whether or not the individual(s) has performed military or national service. Thus, for example, a married couple who have both completed full military service and who are in a bad socio-economic situation receive NIS 124,500 more in total than a married couple in the same socio-economic situation, when neither spouse has served in the military.

The petition includes in-depth official data regarding the socio-economic status of the Arab minority in Israel, which is the lowest in the state as compared with all other population groups except for migrant workers, as well as poverty data, comparative figures related to unemployment rates, wage-levels and housing density. One of the statistics included in the petition is the fact that in 2004, 49.9% of Arab citizens of Israel were classified as poor (under poverty line) as compared with 15.9% of Jewish citizens, according to the National Insurance Institute.

Result: In 12/06, the Supreme Court rejected the petition, deciding that there is no impediment in principle to granting benefits to those who have completed full military and national service above that which is afforded in the Absorption of Former Soldiers Law, provided that the use of the military service criterion is justified in the circumstances. The Court rejected Adalah’s argument that the use of this criterion results in discrimination against Arab citizens. It is Adalah’s position that the Supreme Court allowed the use of a criterion that severely discriminates against Arab citizens, and that the authorities may abuse this verdict as a cover for intensifying discrimination against the Arab community. Further, the Court ignored the housing crisis faced by Arab citizens, and also contradicted prior rulings, according to which neither the intentions not the motives but the result of a certain policy should determine whether or nor we are dealing with discrimination among groups, as well as a recent ruling in H.C. 11163/03, The High Follow-up Committee for the Arab Citizens in Israel, et al. v. The Prime Minister of Israel, which dealt with the exclusion of Arab towns from the list of National Priority Areas. According to this ruling, the state is not permitted to grant benefits, especially significant benefits, in addition to what is already provided in primary laws.

Update: In 2/07, Adalah filed a motion to the Court requesting a second hearing on the basis that the decision contains a grave error of law.

H.C. 11956/05, Suhad Bishara, et. al. v. The Ministry of Construction and Housing (petition dismissed).