Ministry of Finance director wages Yuval Rachlevsky has opened disciplinary proceedings against Governor of the Bank of Israel David Klein and the Bank of Israel workers committee for alleged violations of the Foundations of the Budget Law (1985). In a letter sent last month, Rachlevsky ordered Klein and the workers committee to respond within 30 days.
The letter reveals one of Bank of Israel's most carefully-guarded secrets, kept hidden for years: the list of benefits paid to the central bank's employees from the state coffers in apparent violation of the law.
The disciplinary hearing, the first of its kind against Bank of Israel officials, has been approved by Attorney General Elyakim Rubinstein. Klein and the workers committee are suspected of illegally spending Bank of Israel money since 1985, amounting to hundreds of millions of shekels.
In his letter, Rachlevsky claims that for years, the Bank of Israel has reached agreements with the workers committee that were not submitted to director of wages for discussion or prior approval, as required under Article 29 of the Budget Law. These agreements were in the form of collective contracts, other arrangements, drafts, etc.
Rachlevsky claims that the result was the payment of exorbitant salaries and illegal benefits, and other irregularities. Despite warnings, Rachlevsky went to say, the Bank of Israel persisted in its actions.
Rachlevsky alleges that the situation had become so pervasive that in 2001, over 17% of Bank of Israel employees were earning more than NIS 30,000 a month. The average salary at the Bank of Israel was almost double the average in government ministries and triple the average salary in the country.
Published by Globes [online] - www.globes.co.il - on December 25, 2003