For 1st time, IDF published data of pensions being paid

Revealing retirement benefits data for 1st time, IDF is paying out 6.8 billion shekels in 2014 to some 35,000 retirees, with ex-combat soldier, 82, leading pension payments at 63,000 shekels per month.

 

 

In response to a request from Haaretz, the Israel Defense Forces Spokesperson’s Office has published a list revealing the highest pensions being paid to former army personnel. Topping the list is an 82-year-old former combat soldier who receives some 63,000 shekels per month.

IDF Chief of Staff Gantz.

IDF Chief of Staff Gantz oversees a military drill. – Photo by IDF Spokesperson’s Unit

The army is expected to pay some 6.8 billion shekels to about 35,000 retirees (the army censor does not allow publication of the exact number) in 2014. This amount is part of the 22 billion shekels the state pays out annually for the budgetary pensions of retired civil servants and defense-establishment personnel.

The army finally abolished the budgetary pension arrangement that had previously been the norm in 2004. In this arrangement, an army retiree received an amount of money every month that was equal to two percent of his determining salary, multiplied by the number of years he had served, up to a maximum ceiling of 76 percent. This enabled those who retired after 25 years’ service to receive an allowance amounting to 50 percent of their salary. Those with special professions, such as pilots and divers, received 3 percent per year.

In addition to this arrangement, there is a special army arrangement in which the chief of staff grants “artificial” percentage points to those in the service. The average amount of the “chief of staff’s grant” is 6 percent of pension.

The budgetary pension arrangements are a heavy burden on the state budget. This is particularly true of the army pension that is provided from IDF retirement age, which for many years was 42 – so the state was paying pensions to retirees for about 40 years.

This is the first time the army has revealed statistics about the allowances it pays to its retired personnel – numbers that, for many years, were kept secret from even the Finance Ministry.

The numbers indicate that the average allowance paid to army retirees is 10,774 shekels per month – a number that is much lower than the one released by the Finance Ministry (which said the average pension paid to army retirees in 2012 was 16,600 shekels per month). In any case, the number is significantly higher than the average pension that civil servants receive (roughly 6,500 shekels per month).

On the list of the 100 recipients of the largest pensions – 76 of whom are former combat soldiers – are soldiers who retired in their 50s, evidently former major generals and chiefs of staff. The one receiving the largest pension is a former combat soldier who retired at age 54. Today, nearly 30 years later, he receives 63,306 shekels per month. On a list of the 100 recipients of the largest pensions in the civil service, this army retiree would come in a respectable ninth.

Second place on the army table goes to a retiree who receives 61,306 shekels per month, while the third highest receives 57,914 shekels. In eighth place is a man who served in a noncombat technological capacity, retired at 53 and is receiving a monthly pension of 51,037 shekels. Bringing up the rear among the list’s 10 highest retirees is a combat support soldier who receives a monthly pension of 49,887 shekels. The lowest on the top 100 list receives 39,887 shekels per month.

The total annual cost of the pensions paid out to the top 100 retirees is 53.8 million shekels per year. The average retirement age among them is 52. Although they are high-ranking people who served in the army for many years, this retirement age is still far lower than the general retirement age for men, which is 67.

These statistics also indicate that 0.3 percent of the army’s retirees receive an allowance of over 40,000 shekels per month; 1.3 percent receive between 30,000 and 40,000 shekels; 5 percent receive between 20,000 and 30,000 shekels; and 39 percent receive a pension ranging between 10,000 and 20,000 shekels. Fifty-five percent of the retirees receive a monthly stipend below 10,000 shekels a month.

Since the retirement age in the army is lower than in the rest of the workforce, the recipients of the largest pensions could cost the state more than 20 million shekels. The cost of the pension of a retiree who receives the average amount after retiring at age 42 is up to 6 million shekels.

Together with the highest-pensions list, the army also released a list of those who receive the lowest pensions, to show the other side of the coin. The average monthly salary in the army, which relies in large part on young personnel, is 12,681 shekels, meaning that noncommissioned officers can be paid only a few thousand shekels, from which their low pensions are derived.

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Haaretz

The lowest pension amount, 1,297 shekels, is paid to a former combat support soldier who retired at age 40. The statistics do not clearly show the number of years service for which he is collecting the pension; he might have left the army for some years during his term of service and served only for a few years. In last place on the list of the lowest 100 is a former combat support soldier who also retired at 40 and receives a pension of 2,495 shekels per month. Their situations are still better than 1,200 officers and NCOs who were dismissed without a pension over the past year. Some of them have military professions and are older, which could make it difficult for them to find new jobs.

The statistics provided by the army are accurate up to October 2013, and the amount being paid in pensions continues to grow every year.

After a long struggle by the Finance Ministry, the pensions of career soldiers were linked to the Consumer Price Index, after being linked to the salaries of soldiers in active service until 2012. In other words, if the salaries of major generals were to increase, the retirees’ allowances would increase at a similar rate. This is how the pensions of the top 100 gradually rose. This arrangement was convenient for the retirees, since over the years the salaries of those on active service rose at a rate higher than the CPI.

As part of the agreement with the army, which led to a change in the legislation, one-time supplements and permanent supplements of up to 20 percent of the previous allowance were given to the retirees. The “public treasury” arrangement – according to which retirees from the army who continued working in a public agency did not receive their full pensions as long as they were employed there (so as to prevent double payments) – was also discontinued.

Some of the retirees opposed the agreement and left Tzevet – the war veterans’ association – which had approved it. They submitted a petition to the High Court of Justice against the agreement, but the petition was thrown out.

Last October, Haaretz and TheMarker published the list of the 100 highest pensions in the public sector. The highest budgetary pension goes to a former attorney general, who receives 86,512 shekels per month. In second place is a former religious court judge, who receives a monthly stipend of 83,512 shekels. Religious court judges and chief rabbis receive pensions parallel to those of judges. In third place is the widow of a religious court judge, who receives 78,704 shekels per month (in addition to her own pension, if she has one).

In fourth place on the list is another former attorney general, and in fifth place is another widow of a religious court judge.

Of the 300 people who receive the highest pensions, the vast majority (83 percent) are judges and those considered parallel to them for pension purposes. Deputy attorneys general, district prosecutors (criminal and civil) and department managers in the Justice Ministry receive pensions parallel to those of district judges. Apart from them, a former member of the Knesset Guard receives 56,848 shekels per month, placing 16th on the list.

In 20th place is a former cabinet minister whose pension is 55,963 shekels per month.

The salary agreements in the State Comptroller’s Office, which give workers amounts significantly higher than the Civil Service, are also represented in pensions: In 262nd place is a former employee of the State Comptroller’s Office, who receives a pension of 32,000 shekels per month. A few Civil Service employees have managed to grab a spot on the top 300: a former employee of the Housing and Construction Ministry receives 27,956 shekels per month, as does a former employee of the Social Affairs Ministry. A legal adviser in the President’s Residence receives a monthly pension of 29,453 shekels. While these amounts are higher than the salaries of career soldiers, the low retirement age in the army makes their pensions costlier over the long-term.

 

View original HAARETZ publication at: http://www.haaretz.com/news/diplomacy-defense/.premium-1.581549

 

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