Israel is the only democratic, advanced-economy country where state or quasi-state agencies own the vast majority of the land area. An estimated 93 percent of the country’s total land area (excluding the occupied areas of the West Bank and Gaza) is owned by the state or by quasi-state agencies. Furthermore, Article 1 of Basic Law: Israel Lands stipulates that:
The ownership of Israel lands … shall not be transferred either by sale or in any other manner.
A combination of factors – Israel’s small geographic size; its growing population and commitment to absorption of immigration; its official “nation-building” Zionist ideology; and its security needs – has encouraged Israeli policymakers to retain the principle of national ownership and to harness land policies in order to achieve national goals. Today, however, these ideological justifications are no longer immune from criticism, as the Committee discussions demonstrated.
“Israel lands,” as defined in Basic Law: Israel Lands (of 1960) consists of lands owned by the following three bodies: the State of Israel, the Jewish National Fund (JNF) and the Development Authority.
The lands owned by the state are the lands that were owned by the British Mandate over Palestine until 1948. These lands constitute about 75 percent of all Israel lands.
The JNF is a nonprofit worldwide organization established at the end of the nineteenth century as part of the Zionist movement. Its major goal was to purchase land from local landowners for the settlement of Jews. Until the early 1960’s, the JNF managed its own land holdings. In 1960, it signed a treaty with the State of Israel whereby it agreed to place its land holdings, without transferring title, under the administration of the Israel Lands Administration and its governing body – the Israel Lands Council. The JNF appoints half (less one) of the members of the Council, while the government appoints the other half (plus one). JNF lands constitute about 13 percent of the total of Israel lands.
Viewing itself as a custodian of land for the Jewish people, the JNF incorporated into the treaty with the State of Israel a further and highly controversial condition: the Israel Lands Administration would be allowed to lease JNF land to Jewish people only, whether to those living in Israel or residing abroad. Theprohibition on Arab Israelies to buy or lease land in certain areas that were designated for Jews only was challenged at the Supreme Court that decided in the year 2000, in the landmark case of Kaadan, was discriminatory and impermissible. Allocation of State Lands to the Jewish Agency for the Settlement of Jews only, the Court decided, was illegal, due to the discrimination of citizens on the basis of religion and nationality. The values of Israel as a Jewish and democratic state, the Court declared, prohibit discrimination in the allocation of lands between Jews and non-Jews. Read More.
The third source of national land pertains to the remaining 12 percent, the most politically sensitive type of national land. A statutory body established in 1950, the Development Authority, received its holdings from the Custodian of Absentee Property, a governmental body that took charge of land owned mostly by Arab residents who left or were expelled from their place of residence during the 1948-9 war. Most of these lands have been leased or sold.
The Rationales for National Ownership of Land
During Israel’s incipient years, and still to some extent today, public land ownership was seen as a key instrument for achieving the country’s territorial and demographic stabilization. In the years following the 1948 War of Independence, Israel sought to establish its legitimate standing within its international borders, some of which were (and still are) officially only armistice lines. This agenda yielded a strong focus on population distribution as widely as possible to the Galilee in the north and the Negev desert in the south. The goal was to create a Jewish presence in most areas of the country. State control of land ownership was one of the major tools that enabled the achievement of population distribution and Jewish presence goals.
Today, the ideological basis for national ownership of the land is receding, and the near-monopoly of the Israel Lands Administration no longer is immune from challenge. Several legal experts that testified before the Committee cast doubt on the desirability of national ownership.
Experts mentioned three main considerations against the principle of national ownership of land. First, even though the Basic Law prohibits transfer of ownership, the situation de-facto is that the rights granted to leaseholders under the current Israeli leasehold system closely resemble full property rights. Israeli citizens and the Israeli market treat leased lands as owned by the leaseholders. Thus, the control of the state in leased lands is severely limited, pragmatically and legally.
Second, legal experts pointed out that there are various ways through which the government can exercise control over the uses of land in the state, most importantly through planning and zoning laws. State ownership is not needed in order to control land development. Even the goal of protecting land from being sold to aliens can be obtained through laws specifically restricting land transactions of private parties, instead of national ownership of all lands.
Third, experts pointed out the inefficiency of the state machinery that manages Israel lands and questioned the necessity of the large and heavy bureaucracy of the Israel Lands Administration.
Three main alternative proposals were made. First, to keep the current arrangement, and solve any immediate problems within the exisitng system; Second, to radically reform the law and abolish the comprehensive national ownership; and third, to keep national ownership but regulate it not in the constituion but in ordinary legislation, which will then allow future parliaments to introduce changes relatively easily.
Sources: Constitution for Israel Project