Governor's Appointees Enjoy Fat-cat Salaries

The salaries of Bank of Israel Deputy Governor Zvi Eckstein and Director General Yaakov Danon are NIS 50,000 a month. The central bank's spokesman confirmed the information in response to an inquiry by TheMarker.

The two are personal appointments of the Governor Stanley Fischer and were both made in the past year. They were both appointed after the bank's wage scandals hit the headlines, and were part of Fischer's attempt to create a new image for the central bank.

But it turns out that in spite of the new clean image, Fischer continued the previous custom of paying excessive salaries to senior bank staff - and without proper approval. The NIS 50,000 monthly salaries are considered exceptional in the public sector. In comparison, the director general of a government ministry makes do with only NIS 31,000 a month. A minister makes NIS 35,000, the prime minister earns NIS 40,000 a month, and the president of the Supreme Court has a monthly salary of NIS 45,000.

In addition, the two have been receiving these salaries even though the Bank of Israel has yet to receive approval from the wages director in the Finance Ministry.

The treasury responded: "The issue of the salaries for senior officials in the Bank of Israel has not been brought for approval by the wages director." The treasury added that the wages director is holding discussions now, which are intended to set new rules for wages at the Bank of Israel, including the salaries of the new senior officials at the bank.

The spokesman for the Bank of Israel justified the salaries paid to the two, even though they exceed public sector norms, saying that the Bank of Israel is a public institution that is not subject to civil service wage scales.

While it is true that civil service wage scales do not apply to the bank, there are still other normative wage scales for such public bodies. They are set by a committee made up of representatives of the public and the wages director.

This committee has decided that the highest salary level in such public institutions - usually the director general or CEO - is in the NIS 40,000 to NIS 45,000 range.

Even according to these scales, the salaries the Bank of Israel is paying are excessive. The fact that Fischer is paying his senior officials wages beyond those accepted in the public sector - and without official approval - makes it very difficult for him to present the bank as having undergone a revolution. It certainly harms the image of the bank as having given up its habit of paying excessive benefits and wages to employees.

The bank's new management, headed by Fischer and Danon, has constantly claimed that it is putting the bank on a new road - and that the exceptional salary conditions that it provided in the past are over, or at the very least will not return.

These claims certainly do not match the facts, as the Bank of Israel continues to set its own salary scales for its senior staff (including the director general) and sets them well above what is acceptable for public institutions.