Treasury Pressing IDF to Cut Costs

The Finance Ministry has a long list of budget cuts and other demands for the IDF, and is trying to include them in the Economic Arrangements Law for 2011 - but the IDF is not willing to give up without a fight.

Among the treasury's demands are shortening recruits' compulsory service, raising the retirement age for all noncombat soldiers, and for the first time giving the treasury the ability to fully supervise the IDF's wage and benefits system. Until now the IDF has kept the treasury from receiving complete and detailed information on its salaries.

In addition, the treasury wants to reduce certain tax breaks given to soldiers, such as paying reduced National Insurance and health tax rates. The IDF also pays for the taxes on the cars they provide soldiers for their personal use. Altogether, reducing these tax breaks would save NIS 50-100 million a year.

The finance and defense ministries have been trying to come to an agreement on raising the retirement age for a year, but have failed to reach a deal - and the treasury is hoping to force the cabinet to make a decision. Today, combat soldiers can retire at 45. The average age of retirement for noncombat soldiers is now 46, but the treasury wants to raise it to 52 for officers and 57 for noncommissioned officers.