The plan presented by the Defense Ministry and the Israel Defense Forces to the government last Thursday seems as if it were conceived in a parallel universe. This is a plan to increase pension rights for the standing army, by which soldiers ages 40 and under, who retire at 42 will receive a bridging pension until they reach the official retirement age of 67 – and will receive a pension bonus worth 7 percent of their pension.
In addition, combat soldiers and those who studied in the military’s academic reserves will receive a “supplement on the supplement” of another 3-4 percent, and in total will receive a pension grant of 11 percent until they reach retirement age.
The plan will add extra costs of around 500 million shekels ($155 million); current annual IDF pension payments are around 8.2 billion shekels. But the plan’s main impact will be on the already heavy pension burden of the military.
Just 48 hours before the new plan was submitted, Israel’s 2020 financial reports revealed that the defense establishment’s actuarial debt had climbed 30 percent in the past two years, reaching the huge sum of 366 billion shekels, which is already 40 percent of the national actuarial obligations – which is nearing 1 trillion shekels. But what do these facts have to do with the military? The publication did not change anything in the defense establishment’s plans, as if it offered data from another country. The new plan would inflate the IDF’s actuarial obligations by another 15 billion shekels.
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Amazingly, the outrageous plan won approval in principle from Prime Minister Naftali Bennett, Finance Minister Avigdor Lieberman and Defense Minister Benny Gantz. In a small meeting the three held last week, they agreed on an unprecedented increase in the defense budget, 14 percent, and the “laundering” of other salary excesses the military was caught doing. Along the way, the three also agreed on the new added bonuses for the standing army.
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Bennett and his ministers did not tell the rest of the cabinet about their agreement. The other ministers were asked at the beginning of the week to vote in favor of the new state budget and an across-the-board cut of 1.5 percent in their ministries’ budgets – except for the Defense Ministry. The ministers were told that the defense budget increase was necessary for urgent security considerations, and that the cuts were actually needed because of the increase in the health budget.
Bennett, Lieberman and Gantz, all former defense ministers, who promised to change national priorities, are allowing the draining of civilian budgets in favor of boosting defense spending. They are then hiding from the public and the rest of the government’s ministers their controversial moves. This behavior is negligent economic management, which will make Israel’s actuarial distress even worse.
The above article is Haaretz’s lead editorial, as published in the Hebrew and English newspapers in Israel.