Israeli Army Salaries 22% Over Budget in 2012

Treasury officials say consistent overspending by Israel's Defense Ministry is caused by a lack of tight supervision of the security budget.

Salaries paid to Israel Defense Forces officers are far in excess of the amounts contained in the defense budget, according to Finance Ministry data obtained by TheMarker. Treasury officials are promising to fix the long-running problem.

In 2012, actual spending on career officers' salaries exceeded approved spending by 22.1% - or NIS 10.2 billion versus appropriations of NIS 8.3 billion, the highest in the six years covered by the data. In 2006, the difference was 12.4%, with spending of NIS 6.7 billion approved while the actual amount reached NIS 7.6 billion.

The figures show that in some years the overspend has been as low as 5%, but is consistently more than the amounts allocated in the budget. Salary costs have risen as much as 8% a year in the seven years to 2012.

A similar trend occurred with the expenses budgeted for commemorating fallen soldiers and assisting their bereaved families - a particularly sensitive budget item. In 2012, the defense budget allotted NIS 1.7 billion for the services, but in practice the ministry spent NIS 2.6 billion, an overspend of NIS 900 million (48% over the budgeted figure).

"The Defense Ministry is not familiar with these numbers," the ministry said in response. "The ministry operated, and is supervised, in accordance with the Budget Law."

According to veteran Finance Ministry officials, the overspend is facilitated by the fact that the defense budget is far less transparent than that of other ministries. The Defense Ministry is the only one that draws up its own budget without tight supervision from the treasury.

In recent years - including in the current 2013-14 budget - the Defense Ministry has only provided the treasury with figures on spending for broad budget categories and has failed to provide detailed accounting of line items, as other ministries are required to do.

In addition, the Defense Ministry regularly submits several supplementary budget requests over the year to the government, which are almost always granted. For other ministries, treasury officials said, budget supplements are rarely approved during the year.

At other ministries, accountants employed by the Finance Ministry and its budget division monitor expenditure during the year, to ensure that any disparity between the final figures and allotted budgets are minor. Treasury officials say this practice will now also be carried out at the Defense Ministry, starting in the current fiscal year.

A strenuous lobbying effort by former Finance Minister Yuval Steinitz resulted in the treasury gaining more access to the Defense Ministry budget data.

IDF Spokesperson's Unit