Minister of Finance Ronnie Bar-On this morning sharply criticized an initiative to adopt the Irish model in Israel being promoted by Manufacturers Association president Shraga Brosh and Histadrut chairman Ofer Eini.
At a "Forbes" conference marking Israel's 60th anniversary, Bar-On said, "Right at the height of activity, and despite the great number of challenges facing the Israeli economy and society, there are now growing calls to the reduce the power of the Ministry of Finance and to create alternatives, undermine the authority of the budget, and challenge the fiscal policy we've created."
Bar-On added, "I've been hearing calls lately aimed at the method of government in Israel, to adopt the Irish model. Reports say that there are proposals for establishing by legislation a social-economic council in which three parties will have equal powers: representatives of the Histadrut (General Federation of Labor in Israel), the Manufacturers Association of Israel, and the government. The prime minister will head this council, which will deal with strategic planning and setting budget and macroeconomic policy, tax rates, and all economic matters. They also propose that the council should replace the Governor of the Bank of Israel as an advisor to the prime minister.
"This is an attempt to change the method of running the economy from one of democracy in which the citizen has direct influence through the legislature to another kind of regime in which the social order is dictated by brokers of the trade unions and other sectors that do not necessarily represent the general public. I regret, but I find the idea to be utterly against the parliamentary process."
Bar-On noted, "The only way is to engage the people in political dialogue. In the present circumstances, we're not talking about change, but a proposal for a coup! Social-economic policy must be managed from the perspective of balancing conflicting interests. Anyone looking at the latest reforms should ask himself whether they could have been implemented under the proposed model.
"On the contrary, the model would probably lead to a policy based on compromise that does not always serve the goals of the economy. Instead of dealing with structural reforms and undermining the foundations of democracy, I invite the representatives of the unions and the manufacturers to participate in the constant dialogue that we're holding about the policies we're leading. This dialogue has a key and worthy function in narrowing social gaps. To those wishing to talk, we say, 'Welcome'."
Published by Globes [online], Israel business news - www.globes-online.com - on April 14, 2008
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