Poriya Hospital near Tiberias will soon be getting a state-of-the-art underground hospitalization ward at a cost of $7.8 million. Some $1.2 million of the costs will be paid for by the Conference on Jewish Material Claims Against Germany, the umbrella group that represents the Jewish people in negotiations for Holocaust compensation. The Claims Conference will provide funding for the project at Poriya and the other hospitals in the north of the country out of monies earmarked for the benefit of Holocaust survivors in Israel. Group officials say 31 percent of patients at Poriya Hospital are survivors, and that their proportionate share in the project is even lower.

Nearly $200 million intended for improving the lives of Holocaust survivors in Israel have gone in recent years to building hospital departments, old-age homes and nursing facilities. These investments alleviate the plight of hospitalization and serve the general Israeli public, including Holocaust survivors. But survivor advocacy groups say it is preposterous for the Claims Conference to do the Israeli government's job while tens of thousands of Holocaust survivors are in need of help.

The Claim Conference's board of directors on Wednesday approved allocations for many dozens of organizations and institutions throughout the world that deal with the Holocaust and survivors. Every year this body distributes some $100 million, about half of which goes to Israeli entities.

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To date, the Claims Conference has given out over $1.5 billion. The source of the funding is proceeds from the sale of real estate in East Germany. The Claims Conference received the properties under a clause in German law that recognizes it as the owner of all assets belonging to Holocaust victims without heirs. The board of directors decided to divide the money as follows: 80 percent to organizations that deal with the welfare of remaining survivors, and 20 percent to organizations that deal with documenting the Holocaust, research and education.

However, Haaretz has discovered that in practice, less than half the money goes directly to helping survivors. The reason for this is that in Israel, unlike the rest of the world, the Claims Conference invests in constructing permanent buildings. In recent years, the Claims Conference funded the building of new departments at all major hospitals in Israel, was a partner in building more than 100 daycare centers for the elderly and in building hundreds of rooms at old-age homes run by the Jewish Agency's Amigur network.

Survivor groups estimate that 30 percent of Israel's elderly citizens are Holocaust survivors. At some of the projects funded by the Claims Conference, the rate is even lower. Journalist Raul Teitelbaum says that a random check in 2005 at an assisted living building in Ashdod, built with the help of the Claims Conference, revealed that 97 percent of the tenants are not Holocaust survivors. In his book, "The Biological Solution," Teitelbaum explains that the Jewish organizations that are in charge of the Claims Conference were opposed throughout the years to allocating monies to survivors and prefered to distribute them for other needs.

In May, a committee headed by Social Affairs Minister Isaac Herzog determined that Holocaust survivors in Israel urgently need aid totaling NIS 1.2 billion annually. The committee found that there are 170,000 survivors in Israel who do not receive any aid, of which 60,000 are in need of immediate help. The main body that assists survivors is the Holocaust Survivors Welfare Fund, which gets $40 million a year from the Claims Conference.

Reuven Merhav, chairman of the Claims Conference's executive committee, said in response that it has been allocating funding to enhance the infrastructure for Israel's elderly survivors for over half a century. These allocations are limited to the one-time costs, but they serve to "leverage large amounts of additional funding for both the remaining one-time costs as well as the maintenance costs over many years."

Merhav added that the proportion of survivors using these facilities is far greater than the percentage of funding by the Claims Conference.