The Union's Hotline to Its Banker

"I am not prepared to be just another marginal element at the bank. If I am marginalized, I won't be able to influence the bank to safeguard my colleagues. I can only do that at my bank, Bank Yahav," Ariel Yaakovi, the chairman of the Civil Servants Union, told TheMarker.

Last week Yaakovi disrupted the government over the intentions of the treasury's accountant-general, Yaron Zelekha, to open to tender the provision of banking services to civil servants. This week, as the accountant-general dug in and refused to halt the tender process, Yaakovi may yet achieve what even the prime minister couldn't - clipping the Zelekha's wings. That isn't bad for two weeks of effort, mainly given that the official issue at stake, leading to all this, is the sum of NIS 9 million a year. No, that's no typo, just NIS 9 million a year; that is the maximal damage that the state's workers can claim to suffer in the context of the bank services tender. At least, that's what they can claim officially.

Between NIS 6 million to NIS 11 million, let's say NIS 9 million, is the annual dividend that Yahav has been paying in the last few years to a company called Culture and Economic Projects for State Workers. A company whose chairman is named Ofer Eini.

Yes, that's the same Eini who chairs the umbrella Histadrut labor federation, and it's no coincidence. Culture and Economic Projects for State Workers is a joint company belonging to the state and the Histadrut, but in practice, the Histadrut calls the shots.

The function of the Culture and Economic Projects company is to care for the welfare of state workers. It uses dividends it receives from Bank Yahav and budgets from the state to finance summer camps for state workers' children, to buy dental insurance at a discount, that sort of thing.

Its activities are important, to be sure, but it deals the goodies out with a miserly hand. Although its resources are just NIS 12 million a year from the treasury and Bank Yahav, it has accrued surpluses of NIS 45 million. It clearly isn't spending that much on the welfare of the workers.

Does NIS 9 million justify disrupting the government's work? Not likely, especially when the tender is intended to benefit state workers. The treasury is suggesting in its tender that banks compete to provide the services Yahav did, and more, or at the very least to maintain the same level of service but at through a far greater network of branches compared with tiny Yahav. Also, presumably, it would cost the state less.

If the union wanted to assure that Culture and Economic Projects' sources of financing would not be impaired by the tender, it could have said so. We have to believe that the treasury would have come up with some sort of solution with the Histadrut with just NIS 9 million at stake.

But the demand was not raised. What Yaakovi demanded was to be a partner in the tender, a bizarre demand given the fact that the Histadrut owns Bank Yahav, and Bank Yahav is supposed to be one of the bidders. Or, Yaakovi suggested, the whole idea of the tender should simply be canned.

"I and the 130,000 state workers with me won't become a cash cow for the rich banks," declares Yaakovi. "I am not prepared to open the door to the commercial banks, allowing them to handle state workers, giving them access to state workers and tempting them with all sorts of loans at full bank prices. The banks can finance their exorbitant fees at somebody else's expense."

Well said. But the truth is that Bank Yahav also makes its money from offering the state workers, its captive customers, additional banking services - provident funds, credit cards and so on, at full price.

The truth is that if Yaakovi is concerned about the welfare of the state workers, the only thing he should care about is to maximize the benefits offered by the other banks. How much the bankers offering the discount services make is none of his business.

But Yaakovi doggedly hangs his argument on the irrelevancy of the high wages of the bankers to block a tender that a heart, does good and might even improve the situation of the workers, improve state revenue, and that also complies with the Tenders Law, and the demands of the State Comptroller. Why is he doing it?

One possibility is that it's convenient for him to present the benefits the state channels to the workers via Yahav as being his achievement, as he sees Yahav as being his.

Another possibility is what Yaakovi fully admits: at Yahav, he's got the moves. At Yahav, he owns 25% of the shares, and he's his own main client (most of Yahav's clientele are state workers). Therefore, at Bank Yahav, he has special status. We may assume, a direct line to the bank management. A direct line that he wouldn't have with the managers of any of the commercial banks. And that is a privilege, at the personal and organizational level, that the Histadrut is not willing to forgo.