Fiscal Black Holes

From the 31st floor of North Tel Aviv's Akirov Towers, the royal suite at the InterContinental Le Grand hotel looks rather cheap. What is a measly 2,500 euro (NIS 13,750) a night to someone whose apartment is worth NIS 30 million?

The problem is that the apartment was purchased from Ehud Barak's personal money, and it's his own business. His stay at the InterContinental hotel in Paris, however, was funded on the public's dime, and is therefore our - the taxpayers' - business. There is no reason that Gabi Cohen of Hadera should fund Barak's lavish - borderline corrupt - lifestyle, simply because it is labeled "security spending."

Barak is a known pleasure-seeker. His capacity for shame has long since disappeared, and he could have demanded the delegation organizer reduce proportions and choose a more reasonably-priced hotel, as befits a small, relatively poor country.

A month before the trip, amid the worldwide economic crisis, the government made a decision to cut spending on accommodation abroad.

Barak apparently doesn't care. Why should he scrimp and save? We should all save so he can live it up.

The details of the affair are just as disturbing. The royal suite was ordered for six nights, even though the delegation stayed for only four, so the actual price of the room reached 3,750 euros a night - 22,500 shekels - a ludicrous sum.

It's not only the royal suite. It is also the inflated contingent of 50 people (it originally stood at 58), pampered in particularly expensive rooms, well above the accepted norm. Those four nights in Paris cost taxpayers the exorbitant figure of NIS 944,000.

All of this was possible because the delegation was sent by the Defense Ministry. Unlike other government ministries, which Finance Ministry accountant general Shuki Oren has full fiscal control over, the budget at Defense is a black hole which goes virtually unmonitored.

The Defense Ministry accountant is technically a subordinate of the accountant general, but in effect Oren is unable to contend with the ministry and the IDF. The hotel reservations in Paris were made by a military delegation to Paris, with the express intent of circumventing his authority.

A normal government ministry simply cannot spend such amounts because it doesn't have a budgetary foundation to do so. But the Defense Ministry has a massive budget (NIS 50 million) with many black holes from which money can be scraped for almost any use.

So how did the accountant general learn about the matter? It happened a week before the Paris Air Show began. Transportation Minister Yisrael Katz asked to stay at the same luxurious hotel, but his own ministry's accountant told him it was simply too expensive.

Katz asked bluntly, "Why Barak and not me?", and his accountant passed that apt question on to Oren, who promptly opened an investigation.

Oren, who has seen his share of wasteful spending, was shocked - he had never come across such a scandal. He immediately wrote a letter to the Defense Ministry director general, warning that whoever violated the accepted norms over the cost of hotel rooms would be fined from his or her own salary. Ultimately he backed down, and it's a shame - it would have taught everyone a lesson.

Currently there are no clear limits on paying for hotels, a deliberate omission which allows this kind of nonsense, which is so common in third-world countries.

We therefore need to give the accountant-general the authority to recommend hotel spending parameters appropriate to ministers, which the Knesset Finance Committee would then have to approve.

Barak and the Defense Ministry have proven there are ministers who must be kept within limits - otherwise they let loose, and we're stuck footing the bill.