Opinion

Israeli Right’s New Bank – the Jewish National Fund

The organization faces calls to investigate suspicions that tens of millions of dollars earmarked for Jerusalem have wound up being used to buy land and other property in occupied territory

KKL-Jewish National Fund charity box
Olivier Fitoussi

A few years ago, a strange thing happened. The rotten organization called KKL-Jewish National Fund agreed, under massive public pressure, to address criticism from the state comptroller.

But this welcome turn of events was soon thwarted by Ministers Yariv Levin and Ze’ev Elkin, the ideological right wing of the Likud. And for good reason: Though it took them decades to realize it, the right finally figured out that it had a handy bank that was flush with cash, devoid of restraints and practically free of outside oversight: KKL-JNF. Why not use this bank for things the government would never agree to fund?

In May 2018, the ambitious secret project got underway. In the KKL-JNF budget, 250 million shekels ($71.4 million) were allocated for the purchase of land. No one knew that the money which was allotted to the agency’s Jerusalem district was being diverted to the territories.

Haaretz Weekly Ep. 47Haaretz

Through a subsidiary, Himnuta Jerusalem, which is registered in the territories, KKL-JNF began a wild and unprecedented purchasing spree that included six or seven deals for 100 million shekels. The contractor was Oved Arad of the Regavim movement (from which MK Bezalel Smotrich also came).

Arad helped carry out deals in Jericho and the Etzion Bloc, Karnei Shomron and the Jordan Valley and, ostensibly (these deals are frequently fake), a deal to buy the controversial Bakri House in Hebron after the court ruled that settlers had wrongfully evicted a Palestinian family from there.

KKL-JNF chairman Danny Atar is actually a member of Labor, but given the party’s political tribulations – Labor’s waning power is erasing his hopes of another term – he lent a hand to the madness. Atar allocated this huge sum without the approval of the KKL-JNF board, behind everyone’s back, and appointed two board members, right-wingers Nahi Eyal and Arnan Felman, to oversee the shopping spree.

An Israeli machinery removes trees near a Jewish settlement in Hebron, February 21, 2018.
\ MUSSA ISSA QAWASMA/ REUTERS

The track the money followed is still not entirely clear. Now there are people calling for an external investigation. How was the money relayed? How were the deals made? Who approved the new policy?

Last week, for the first time, the KKL-JNF board convened to discuss the controversial buying binge. Atar has cited a legal opinion by retired Justice Sefi Alon, who maintained that there is nothing in the KKL-JNF bylaws to preclude its buying land in the territories.

The justice was right, of course. According to the KKL-JNF bylaws, it is also okay to finance bets on horse races or to buy strange wooden huts for schools (This was actually done – at a cost of tens of millions.)

Essentially, the KKL-JNF bylaws permit anything and everything. The clever fellows who founded the fund in 1901 saw to that. In the last few decades, KKL-JNF has been making fewer such controversial purchases.

There was a little bit of investment in the territories, under political pressure – a boardwalk here, a study hall there. KKL-JNF also tried to conceal these actions, so as not to upset Europe, where it also operates, and the center-left parties, which hold a lot of power in the organization.

A little over two years ago, in the wake of justified criticism, the organization agreed to transfer to the state (another) 1.8 billion shekels in 2018-2019. It was agreed that most of the money, 1.4 billion shekels, would be transferred immediately and the rest later. In return, KKL-JNF wanted quiet. Finance Ministry director general Shai Babad, with typical arrogance and brashness, insisted on receiving the entire 1.8 billion at once.

This not-so-terrible dispute led Babad to terminate the negotiations and to seek legislation that would compel KKL-JNF to pay taxes to the state. Under the new law that passed, instead of 1.4-1.8 billion shekels, KKL-JNF would only pay 150 million shekels.

In other words, “Himnuta-Gate” may be just the first step in turning KKL-JNF into the right’s bank for financing. Atar is on his way out, and in his stead they’ll try to bring in a right-winger, the organization’s coffers are bursting with billions of shekels, the settlers’ appetite for land is at a peak, and the state comptroller, for as much power as he still has, cannot intervene.

The fund that had no reason for being has finally found one. Unfortunately, that reason will only make us pine for the days when they were trying to convince us that the environment was their only concern.