Treasury, Tourism Ministry Boycott 'Open Skies' Committee

The Finance and Tourism Ministries boycotted yesterday's maiden meeting of a public committee appointed by Transportation Minister Shaul Mofaz to examine ways to open the aviation industry to competition, in order to protest the committee's establishment. Both ministries are demanding immediate measures to liberalize existing rules that restrict incoming flights, and they oppose the delays that will be caused by the appointment of a new committee to study the issue.

Treasury officials claimed yesterday that Mofaz established the committee, chaired by Transportation Ministry Director General Gideon Siterman, in order to stymie the creation of a new interministerial committee that would conduct negotiations with the European Union over an open-skies policy. The Finance Ministry's proposal for this new body will be submitted to the cabinet for approval today as one of the reforms accompanying the 2007 state budget.

In a letter sent to Mofaz in advance of the public committee's meeting yesterday, treasury director general Yossi Bachar wrote: "The Finance Ministry has no intention of participating in the public committee to examine the open skies issue." Bachar said that the treasury's position is that "the issue has already been thoroughly examined, and now, following the cabinet's decision of August 9, 2005 to encourage competition in the sphere of international aviation, immediate action must be taken to implement the program."

Israeli aviation officials said that the Transportation Ministry is trying to protect El Al Israel Airlines, and is therefore avoiding measures to open the local market to foreign competition. El Al said that it faces a competitive disadvantage against foreign airlines, which, it charged, flood the local market with cheap outgoing tickets.

Transportation Ministry officials said they believed that Finance Minister Abraham Hirchson had personally instructed the treasury's delegate on the committee, Kobi Haber, to stay away from its initial meeting yesterday, due to the political tension between Prime Minister Ehud Olmert and Hirchson, on one side, and Mofaz on the other. A ministry source said it was a "pity that treasury clerks are being used as tools in political fights rather than being allowed to add their professional input to the committee session."