The Bottom Line / Saving Grace

Earlier this week, the cabinet decided on deep cuts in the budget and National Insurance Institute benefits. The decision reminded us of Sephardi chief rabbi Eliahu Bakshi-Doron's idea for saving hundreds of millions of shekels.

In August 1999, Bakshi-Doron said that the rabbinate was the only sector perpetuating ethnicity and that there was no difference between Sephardim and Ashkenazim when it came to kashrut laws, mikvehs (ritual baths) and marriage and, therefore, there was no need for two chief rabbis or for that matter two municipal rabbis for every town.

Bakshi-Doron reiterated such sentiments last week and suggested that he step down from his post, leaving the chief Ashkenazi rabbi, Israel Lau as the sole chief rabbi.

Bakshi-Doron also believes that it would be prudent to dissolve the religious councils affiliated to each local council and transfer their powers to the local councils, a move that, at this difficult time, would save hundreds of millions of shekels a year.

Bakshi-Doron's ideas do not go down very well with the religious parties, with religious apparatchiks, or with the Religious Affairs Ministry, because they all provide an income for hundreds of cronies at the expense of the tax payer.

If only Bakshi-Doron could be appointed as Minister for Religious Affairs so that he could actually execute these reforms, a move that would change the image of religion and its leaders.

The hoodwinking of Strum

In the credit card sector, it is standard practice to charge a "double commission." This is a commission that credit card companies pay to the bank that issued the credit card with which a transaction is carried out. It is a 1 percent charge that compensates the card issuer.

A few months ago, the banks went to Antitrust Commissioner Dror Strum and told him that in the tourism sector, a lot of deals were made over the telephone and were, therefore, considered "no document" transactions. In other words, the banks take on a bigger risk and hence the credit card issuer receives additional commission. Strum accepted the banks' claims and raised the commission charged to travel agents on all credit card transactions by 0.25 percent to 1.25 percent.

But it transpires that under the present contract between the credit card companies and the travel agents, it is the latter who bear responsibility for damages caused by theft or forgery in "no document" transactions and, therefore, there was no room for an increment in the commission charged by the banks.

A quarter of a percent may sound like a little, but the travel sector turns over some NIS 8.4 billion a year (NIS 6.8 billion in outgoing tourism and NIS 1.6 billion in domestic tourism). Around 50 percent of this sum is charged via credit card transactions, and a quarter of a percent of NIS 4.2 billion equals NIS 10.5 million.

So, on the bottom line, the credit card companies have raised their commissions to the travel agents (as of May 1 this year) and the travel agents have passed the buck on to their customers.

In other words, we the traveling public are giving the banks another NIS 10.5 million a year, for nothing, just because the banks managed to hoodwink Strum.