When it became clear a year and a half ago that the Histadrut-run pension funds were going bankrupt, the state stepped into the breach and saved the fund members by nationalizing the funds and subjecting them to comprehensive recovery programs.
Such programs harmed both the pensioners (250,000 of them) as well as the working fund members who pay each month into an accumulative fund (another 250,000). Those already retired were forced to start paying management fees of 1.75 percent, as well as updating their pensions to keep in line with inflation; but not every month, or even every quarter, but only once every two years or after the CPI has risen by 4.25 percent, and that's truly eaten into their pension.
The treasury actually cut pensions in November by about 1 percent to reflect the negative inflation rate, but following talks with the Histadrut, was forced to retract it.
There were some pensioners, for example in the Nativ fund, who enjoyed an arrangement by which they received their pensions on the 10th of each month for that month. The treasury unilaterally changed this arrangement, and pushed pay day to the first of the following month - in other words delayed the payment by some 20 days - which is an additional erosion.
As if that wasn't enough, then for the non-existent service that the Histadrut provides, these pensioners are obliged to pay each month NIS 18 for "organization tax", to fill up the Histadrut's coffers.
The fund members who are still working have been hit even harder. Their monthly contributions have risen by 1.5 percent, the "three-year average" calculation has been dropped, their rights have been whittled down, retirement age has been raised - so that all in all their pension rights have been cut by 10 percent to 20 percent on average.
In comparison, public sector workers who enjoy non-contributory pensions have been left almost untouched; they are dragging behind them actuarial deficits of NIS 280 billion, and this is just for 250,000 workers in government, local government, some retired and others still working.
Starting next month, these workers will have to contribute 2 percent of their salaries to their pensions, compared with 7 percent for private sector workers. The treasury tried recently to cancel the tax breaks on their contributions, but the Histadrut leaped to its feet and prevented that.
The treasury has not forced upon them the "average wage" calculation for pensions, and instead these workers enjoy pensions based on their last, and therefore usually highest salaries. They are not required to pay management fees, and in fact no-one forced them to help in covering the humungous deficit that their pensions have caused - a deficit that amounts to more than NIS 1 million per worker - higher than the deficits of the Histadrut-managed funds.
This is clearly blatant discrimination, which stems from the total protection state workers get from the Histadrut, and the capitulation of Finance Minister Benjamin Netanyahu and the Capital Markets Supervisor Eyal Ben-Chelouche, who knew how to be firm and cruel when dealing with the accumulative funds, but were soft, weak, indecisive and unfocused when dealing, or to be more precise, not dealing, with the public sector's non-contributory funds. In other words, when it came to putting their own house in order.
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