Pulling the plug
For many years MK Avraham Poraz (Shinui) has tried legislating a little reason into the free electricity perk enjoyed by workers and pensioners at the state-owned Israel Electric Corporation.
For many years MK Avraham Poraz (Shinui) has tried legislating a little reason into the free electricity perk enjoyed by workers and pensioners at the state-owned Israel Electric Corporation. Poraz is trying to pass a law that would grant these workers free electricity up to twice the average household consumption, but over this limit, they would pay, like everyone else.
The average household consumption is 6,700 kilowatt-hours, so Poraz is suggesting IEC workers should enjoy 13,400 kwh free.
Last Wednesday, the Knesset Economics Committee discussed the matter, and chairman of the Histadrut labor federation MK Amir Peretz undertook to convince the IEC staff to reduce their perk, in order to prevent this bill becoming law. Thus so the bill was postponed to the beginning of next year.
A few years ago, when the public pressure was high, IEC president and CEO Jacob Razon restricted the perk to 25,000 kwh per year, though even he thought this was exorbitant, and the limit should have been set at 18,000 kwh.
Here are a few salient statistics concerning the IEC, published here for the first time:
l A total of 13,667 individuals are eligible for the perk, of whom 9,738 are working and the others are retired (continuing free electricity to 120!). The perk is equal to a bonus of NIS 460 after tax, reflecting a benefit of NIS 770 per month pre-tax (assuming 40 percent marginal tax rate). The IEC pays the tax on the workers' behalf.
Even without the free electricity, workers at the Israel Electric Corporation are the best paid in the public sector with an average monthly pay of NIS 16,200, with the senior staffers getting NIS 45,000.
l The average consumption of electricity by these workers and pensioners is 14,107 kwh, so that if Poraz bill is passed, whoever uses up to the average, won't be affected.
l The total electricity consumed by these workers and pensioners for free will reach 193 million kwh this year, at a cost to the company of NIS 75.6 million.
l Every household demand among the IEC payroll of more than 18,000 kwh is unreasonable and a flagrant abuse, such as heating the home with the windows wide open, or dishonest selling of the electricity provided free by the employer to one's neighbors or operating a small factory in the backyard - not that there were ever such cases.
l Some 752 individuals consume more than 25,000 kWh. Anyone topping this amount has to pay the extra, so these 752 pay NIS 800,000 for their overusage. Assuming a marginal tax rate of 50 percent, this amounts to a pay bonus of NIS 20,000 a year. So who says it doesn't pay to work for the IEC?