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Finance Minister Ehud Olmert has reached an agreement with MK Haim Ramon (Kadima) according to which NIS 50 million will help to compensate thousands of pensioners whose pensions were cut in last year's sector reforms.

These particular pensioners were included in an unofficial 1996 deal reached between then head of the Histadrut labor federation (and now Labor party head) Amir Peretz and then Labor finance minister Avraham Shochat which would boost their payments after changes were made in the calculation of their pensions that they would have left them worse off. But the deal was never formalized, and the treasury at the time disregarded it.

Nevertheless, in the government's pension reform of 2004, the Histadrut managed to convince the treasury to improve the pension conditions of those covered by this "yellow note pad" deal (named for the yellow pad on which the details were noted down), namely individuals insured with the veteran pension funds and who retired after 1996.

But those that retired before this date did not curry any extra favors and their representatives appealed to Ramon after he was appointed a cabinet minister. Ramon noted in a letter recently sent to Olmert that "NIS 50 million will be allocated in the next 10 years to finance compensation to the principles of the "yellow note pad" for those who retired between 1987 and 1996, and who have not yet been covered by these principles. It was also agreed that the budgetary sources will be carried out through the treasury's budgets department."

These pensions were all insured with Histadrut-run pension funds (known as the veteran funds as they were closed to any new members after 1995), which were nationalized by the government after running humongous actuarial deficits.

Eynav Ben Yehuda adds: Olmert proposed positive discrimination for evacuees from the Gaza Strip to the cabinet yesterday, and his suggestion was approved.

The government unanimously accepted Olmert's suggestion that all state-owned companies seeking new workers should give preference to those who were evacuated from the settlements of the Gaza Strip and the northern West Bank this year.