Bring transparency to the Jewish National Fund
The case of the Jewish National Fund proves just how important transparency is for organizations that trade in public resources.
The Jewish National Fund has consistently opposed being turned into a public benefit corporation, which would require it to issue financial statements. Attorney General Yehuda Weinstein has been leading the charge in this area.
A recent proposal by Justice Minister Tzipi Livni to place the JNF under the scrutiny of the State Comptroller’s Office met with similar resistance.
Knesset members and cabinet ministers support the agency’s right to operate under a financial smokescreen. MKs Robert Ilatov and Shimon Ohayan of Yisrael Beiteinu recently submitted a bill to exclude the JNF and other national institutions (the World Zionist Organization, Keren Hayesod and the Jewish Agency) from the Companies Law.
According those who support the proposed law, continuing the lack of oversight aims to prevent damage to “an important component in their identity as representatives of the [Jewish] Diaspora in the State of Israel.” But figures from the JNF’s financial reports for 2013, cited by Guy Rolnik and published in TheMarker Week on Friday (in Hebrew), show that the main component that would be jeopardized by imposing financial transparency on the organization is that of its employees’ retirement benefits.
According to the quoted figures, in 2013 the JNF, which owns 13 percent of the regulated land in Israel, recorded net profit of 1 billion shekels ($287 million) from the Israel Lands Administration, which manages and sells the JNF’s land on its behalf. Income from donations for the year was 140 million shekels. In other words, 90 percent of the JNF’s net profits are from selling land, some of which it acquired after the state expropriated it from Palestinians and some of which was given to it in transactions that it signed with the state and which were never subjected to public scrutiny.
In addition to revenue from the sale of land, the financial report also reflects the introduction in recent years of expenses into the hundreds of millions of shekels for line items such as “obligations incurred as a result of the termination of the employer relationship” or “obligations incurred as a result of the employee/employer relationship,” having to do with guaranteeing the pensions of JNF employees and retirees, most of whom enjoy defined-benefit pensions, so-called budgetary pensions, funded by the state. At a time when most Israelis are burdened by high property prices, JNF retirees are guaranteed budgetary pensions whose terms are unparalleled in the Israeli economy, certainly when compared to the cumulative pensions of most of their compatriots.
The case of the JNF proves just how important transparency is for organizations that trade in public resources. If Israelis knew what they were funding with the high amounts they pay in order to keep a roof over their heads, they would demand radical reforms.
Weinstein must persevere with the decision to require the JNF to publish financial reports, and our elected representatives should focus on this concern rather than looking out for the interests of the organization’s present and former employees.
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