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Aryeh Dayan | Haaretz | August 22, 2006

Second-class compensation

Is a shop owner in Nahariya, who was forced to close his business during the war, entitled to more compensation than the owner of a similar store in Acre or the Haifa bay area, who had to close shop? Are lawyers and accountants who were forced to close their offices in Kiryat Shmona or Ma'alot eligible for higher compensation than that which will be given to their colleagues in Rosh Pina or Safed?

According to the decisions taken by officials in the Finance Ministry during the war, which were approved by the Knesset's Finance committee, the answer to both questions is yes. Since the government refrained from declaring a state of war, a strange and unusual legal situation has emerged, in which differences have arisen in the amount of compensation paid to various owners of businesses that were affected in a similar way.

The gap between the amount of compensation that was granted - stemming from whether the persons in question were designated as belonging to "confrontation line" communities - is well known and has already prompted three petitions to the High Court of Justice on the part of owners of small and medium businesses, who have requested that the situation be rectified. A fourth petition, submitted by attorney Samuel Dahwar from the Arab village of Fassouta in Galilee, reveals the fact that no Arab communities are included on the full-compensation list even though Arab towns and villages were in the range of the Katyushas and were hit by them.

One of the plaintiffs, Raik Matar of Fassouta, is a practical engineer and graduate of the Technion - Israel Institute of Technology in Haifa. He provides planning services and carries out construction work and repairs. During the war, he was unable to continue with his job both because the government offices he works with were closed, and because the incessant shelling on the part of the Israel Defense Forces' artillery batteries, stationed at the outskirts of his village, made life unbearable. The construction work that he had begun on the eve of the war - in Hurfeish, Kfar Vradim and Arab al-Aramshe - had to be stopped, on the instruction of the Home Front Command, because the residents of these places, like those of Fassouta itself, were not allowed out of the protected areas.

Matar estimates his losses during the month of the war to be some NIS 19,000: He should have earned NIS 15,000, and the remainder would have been ongoing expenses that are automatically deducted from his account (various insurance plans, regular office expenses, etc.). Had his office been situated at Moshav Alkosh rather than Fassouta, attorney Dahwar says, "the state would have remitted the entire sum to him."

Alkosh is no closer to the confrontation line - it lies five kilometers south of Fassouta - but nevertheless the owner of a similar office there would have received the entire sum he had lost, while Matar can expect be left, after paying salaries to his workers, with only NIS 6,500.

Another petitioner, Suleiman Halek, owns a pizzeria in Fassouta and he also lost tens of thousands of shekels during the war. This is a flourishing pizzeria that was opened in 1997 and has since become a central place of entertainment for the youth of the village. "I estimate that before the war, at least half of the youth and children living in the village would come in here every day," he says. Halek's delivery service reached almost every house in the village and the neighboring villages.

During the war, Halek closed the pizzeria, according to Home Front Command instructions, which did not exempt him from paying his ongoing expenses, amounting to some NIS 5,000 per month. His turnover last year amounted to about NIS 35,000 per month. Had he employed workers, his situation would have been even worse than that of Matar. Since the pizzeria is a family business, however, his compensation will be estimated on the basis of his income last year. He will not be recompensed for his ongoing expenses or for damages such as spoiled food products. Had his pizzeria been in Ma'alot, he would have received full compensation from the state, both for the lack of income and for the expenses and damages.

Rational explanations

The root of this problem is the fact that an official declaration of a state of war was never made, which left in place laws and regulations that create two categories of victims, receiving compensation according to different rules and of differing sums. One group, whose existence was recognized by arrangements existing long before this war broke out, are those who have businesses in communities described as being on the so-called confrontation or front line. According to law, the state must compensate these businessmen fully during a time of hostilities, including for loss of income and regular expenses that they incur even when their business is not open. The list of front-line businesses, which is determined and updated by the finance minister, consists mainly of communities that are situated close to the border with Lebanon and as far away as 10 kilometers from it: in other words, the area that was already exposed in the 1970s to the short-range Katyusha rockets.

The second group, which is much larger than the first, consists of all those persons whose businesses are situated in what was defined during the war as "areas of limitation" - that is, places south of the confrontation line, which were exposed for the first time to the Katyushas. The vast majority of the 90,000 business owners in the North fall into this category and they will be recompensed according to new criteria that were drawn up in an agreement signed after the war started between the treasury, the Histadrut labor federation and the employers.

According to these regulations, the state will pay the full salaries of workers employed by these businesses and the remaining compensation will be fixed according to the expenditures for wages - not according to the permanent expenses they have to bear, the damages that were caused or the loss of income. The government will give them 132.5 percent of the wages they pay to their workers and since the business owners are obliged to pay the salaries in full, the sum left in their hands will be 23.5 percent. Businesses that do not have a lot of salaried workers - and many of the enterprises in the Arab sector are in that category - will receive a symbolic sum.

One may have thought the list of front-line businesses was out of date, but from the documents attached to the petition, it transpires that Finance Minister Abraham Hirchson took the trouble of updating it during the war, when the range of the new Katyusha rockets was known. Left off the list were at least four Arab communities that were hit by them. A missile that fell in Arab al-Aramshe took the lives of two people, one that fell in Fassouta destroyed a house and injured one of its occupants, and others that fell in Ma'ilia and Jish (Gush Halav) caused damage to property. Leaving these four communities off the list did not keep Hirchson from adding five Jewish communities, during the war, to the list: Eliad, Degania Bet, Har Odem, Kabri and Safsufa - all located south of the Arab communities that were left off the list.

The matter in question is one of "blatant discrimination on a national basis," Dahwar wrote in his petition, in which he requests that the High Court order inclusion of Arab communities in the list of confrontation-line settlements. "Businesses in the Arab villages close to the border with Lebanon will get less compensation simply because they are Arab."

Dahwar examined the names on the list and found that the only non-Jewish communities included are the largely Druze Pek'in and Hurfeish, and Rehaniya, which is Circassian. He also found that Ma'ilia was not included on the list even though Kibbutz Yehiam and the moshavim Me'ona and Ein Yaakov, located even further from the border, were included and that Jish is not included even though Dalton and Safsufa, also further from the border, are listed.

"Before I presented the petition," Dahwar says, "I tried to find other reasons besides discrimination against Arabs that could cause a rational being like the finance minister to make such a miserable and irrational decision. I could not find them. The instructions that the Home Front Command gave in Fassouta and Ma'ilia were the exact same instructions as they gave in Ma'alot or Alkosh. The damages caused to businesses are the same damages. So what explanation can there be other than racial discrimination?"

On August 8, the attorney sent a letter asking that the finance minister correct these distortions. He submitted the petition only five days later, after he did not hear from the ministry. Treasury officials this week refused to explain to Haaretz why Hirchson had decided to leave the Arab villages off the list that he had updated.

"A petition on the matter has been presented to the High Court of Justice," the spokesman's office replied, "and we'll explain our position to the justices."

Attorney Dahwar, who lives in Fassouta, is also an accountant and he submitted the petition in his own name and in that of four businessmen from Fassouta and Ma'ilia whose accounts his office audits. Dahwar's office is situated in the village of Tarshiha, which because it belongs to the joint Ma'alot-Tarshiha municipality, is actually included among the front-line communities. He himself will be eligible for full compensation, but in the petition Dahwar explains that he too will be affected since the businesses of most of his clients are in Ma'ilia and Fassouta and they will therefore receive much less compensation.

This is not the first time that Dahwar is fighting to have Fassouta, Ma'ilia, Jish and Arab al-Aramshe put on this list. He raised the issue already in 1996, at the end of the Grapes of Wrath campaign, during several radio interviews. The then-finance minister, Abraham Shochat, acted swiftly to remove the issue from the public agenda.

"The finance minister proposed to us then to receive compensation as if we were on the list, but without being included on the list and without this constituting a precedent," Dahwar explains. "At that time, I agreed to the arrangement because I wanted my clients to get the compensation that was coming to them. I won't agree again since it can't be that after every military operation, we will have to fight again for our rights."

This time Dahwar hopes that the High Court of Justice will put an end, once and for all, to what he sees as outright discrimination.

Posted on 22-08-2006

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