Knesset to Discuss Failed Nominations for Bank of Israel Governorship

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The Knesset will convene at the end of the month for a special recess session to discuss the haplessness surrounding the nomination of a new governor for the Bank of Israel. The plenum will also discuss the refusal of Prime Minister Benjamin Netanyahu and Finance Minister Yair Lapid to nominate Karnit Flug, the deputy governor, for the position vacated by former Governor Stanley Fischer. The session will take place on August 29, following a petition advanced by MK Merav Michaeli (Labor) that was signed by all opposition factions.

The petition states that “every day that passes without a governor harms the bank as well as Israel’s economy, turning the country into a laughing stock. Despite the failures in finding a replacement, sources close to the prime minister quoted him as saying “nominate anyone else, just not her,” referring to the highly respected Deputy Governor Karnit Flug, who is currently serving as interim governor. Former Governor Fischer had recommended her as his replacement prior to his departure. The prime minister and finance minister are requested to appear before the Knesset and explain their considerations regarding this issue, which is of great public importance.”

According to Michaeli, “Reports suggest that the finance minister did support Flug’s nomination, which was recommended by Fischer as well as by numerous senior economists and financial analysts. Only the prime minister, for reasons he has kept to himself, announced that she is unacceptable, continuing in his miserable attempts to find someone here or abroad. Does the finance minister yield in this case, as in others, to the prime minister, now rejecting her out of obedience? Did the finance minister find flaws in Karnit Flug that were missed by Stanley Fischer? The State of Israel and its bank are not the private domain of the prime minister or the finance minister. The public has a right to know the considerations that led the finance minister to agree to the scandal of leaving the post unfilled and the reasons for the prime minister’s adamant refusal to nominate Flug.”

Acting Bank of Israel Governor Karnit Flug with the bank's former chief, Stanley Fischer.Credit: Michal Fattal

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