The Bank of Israel said Thursday that the Haredi draft exemption law being advanced in the Knesset will not result in enough soldiers enlisting to fill the country’s security needs or reduce the economic costs of reserve duty.

Weighing in on the hot-button issue, the central bank said that the “wording of the law is deficient in a way that will not result in the recruitment of Haredim that meets security needs while reducing economic costs.”

The proposed legislation, presented by Knesset Foreign Affairs and Defense Committee chairman MK Boaz Bismuth two weeks ago, would continue to grant military service exemptions to full-time yeshiva students while ostensibly increasing conscription among graduates of Haredi educational institutions. It enables full-time yeshiva students who do not engage in any other vocation to be granted yearly deferments from enlistment, but removes various provisions from a previous version that were intended to ensure that those registered for yeshiva study are actually doing so.

The report released by the bank on Thursday named two central problems with the proposed law: the recruitment targets, and the weakness of the financial penalties for draft-dodging. It also questioned the effectiveness of the sanctions proposed to force compliance, noting that penalties for avoiding conscription – including the inability to obtain a driver’s license or housing subsidies, or to leave the country – would expire at age 26.

The Bank of Israel assessed that the economic cost incurred by a reservist leaving his day job for a month and performing military duties is approximately NIS 38,000 ($11,840), reflecting the “immediate cost of lost productivity” and “future harm to productivity growth as a result of loss of experience and/or promotion at work.”

The bank pointed out that, “in contrast, the economic cost of recruiting a young Haredi man for compulsory service is very low, because in most cases conscription does not replace participation in the labor market.” Rather, conscription itself may ultimately lead ultra-Orthodox citizens to join the labor market after their release, the bank added.

Therefore, the economic benefit of conscripting a young Haredi man for 32 months of service — the current........

© The Times of Israel