“For years, the Bank of Israel has provided the Ministry of Finance director of wages with incomplete reports concerning salary costs paid to employees. Some of the problematic findings I discovered when I took up my position are under investigation by the Israel Police,” Bank of Israel director general Ya'acov Danon told the Knesset State Control Committee. He was referring to the findings in a State Comptroller report on salaries at the central bank.
State Control Committee chairman MK Zevulun Orlev (National Religious Party) asked Danon the meaning of “incomplete reports”.
Danon replied, “The full salaries paid at the Bank of Israel were not reported. This was discovered shortly after Governor of the Bank of Israel Prof. Stanley Fischer and I took up our posts. As soon as we learned about this, we notified the director of wages and I ordered that a revised report for 2003-04 be submitted. We found very large differences amounting to tens of millions of shekels.
“Longstanding employees earn between NIS 550,000 and NIS 600,000 a year. Since the Bank of Israel was founded, employees have seen their salaries as something between civil service and the business sector. A similar phenomenon can be seen at other public agencies.”
Danon promised that within 10 to 15 years, the Bank of Israel will have only employees hired under new contracts.
Director of Wages Eli Cohen said that the Ministry of Finance also wanted to reach agreements on restitution, so that the State Prosecutor’s Office would not have to open hundreds of cases. “However, if no agreement is reached, we’ll use our authority. We’ll cut salaries and seek to get back alleged overpayments. Members of the Bank of Israel’s board and employees will repay the money. We won’t give them any discounts. However, it’s always better to do this consensually.”
The Bank of Israel worker’s committee’s lawyer said in response, “The moment unilateral measures are taken, the workers will do the same, and this means the complete shut-down of activity at the bank. The workers should not pay the price for the mistakes and negligence of former bank managers.”
Bank of Israel workers committee chairperson Rimona Leibowitz said, “The time has come for the director of wages to stop using threats and to honor the decisions of his predecessors. It’s unacceptable that after protracted negotiations, understandings and agreements, that a new director of wages will come and wipe out with a wave of his hand all the understandings reached.”
Published by Globes [online], Israel business news - www.globes.co.il - on February 5, 2007
© Copyright of Globes Publisher Itonut (1983) Ltd. 2007