Netanyahu in Haaretz interview / Top bankers' pay is excessive
"Shlomo Nehama's salary is inappropriate," Finance Minister Benjamin Netanyahu told Haaretz in an interview yesterday, which will be printed in full in tomorrow's paper.
"Shlomo Nehama's salary is inappropriate," Finance Minister Benjamin Netanyahu told Haaretz in an interview yesterday, which will be printed in full in tomorrow's paper. Netanyahu accused the chairman of Bank Hapoalim and, in essence, all senior bankers of receiving excessive wages stemming from an uncompetitive market, as well as not being worth the money. Nehama's compensation cost his bank NIS 9 million in 2004.
Netanyahu said it doesn't matter how much someone working for a private company makes; what matters is that his salary stems from fair competition. According to Netanyahu, the banks don't meet this criteria. "Bank Hapoalim and Bank Leumi are a duopoly in practice," he stated. "Real competition would force the banks to lower interest on overdrafts, which might hurt their profit line."
So Shlomo Nehama's NIS 9 million isn't fair pay?
"That salary is inappropriate, until the banking sector is open to competition. I do not think there should be legislative intervention in his salary, which would damage Israel's global reputation. But there would be no such damage if we act to open banking to competition - just as we opened the port sector."
In the interview, Netanyahu accused the Defense Ministry of waste and bullying. "The defense sector's usual response to calls for streamlining is amputating limbs," he said. "They close a division or a squadron instead of streamlining. We have 37 officials handling $2 billion in reciprocal procurement. Egypt, which gets similar defense aid, employs three officials and an Internet site. Our government mechanisms are overinflated. Instead of using tax money to help the needy, we use it to help the pseudo-needy in the Defense and Health Ministries."
Netanyahu said the 2005 defense budget should have been cut by NIS 1 billion. However, defense sector workers and their generals "are Israel's strongest union."