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The Finance Ministry may appear to have won a battle when Prime Minister Benjamin Netanyahu decided Friday to cut the defense budget and raise the retirement age for career soldiers to 50, but the treasury gave up on quite a lot in the process, including efforts to make defense spending more transparent.

In a compromise reached in secret on Friday, the treasury also let up on its demands to oversee military salaries and tenders, at least for now.

The sections of the Economic Arrangements Bill allowing Accountant General Yehoshua Oren to oversee defense salaries and tenders will be part of continuing negotiations between the ministries, but in practice nothing much is likely to change. In this round at least, the treasury will not be able to to rein in spending, increase transparency and enable effective supervision.


The rules for defense tenders are different from those for the rest of the government, especially as relates to exemptions from tenders. Oren’s demand that Finance Minister Yuval Steinitz establish uniform tender regulations was rejected, as was the treasury’s plan to hook up the army’s purchasing and wage systems to the Finance Ministry’s computers to supervise spending.
</text><text>Israel Defense Forces salaries − NIS 16 billion in wages and pensions − have evaded treasury supervision even though the army pays more in salaries than any other Israeli institution, government body or company.