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Israel: Insurance Supervisor appoints temporary supervisors for 4 old pension funds

By Zeev Klein, Globes Online

June 3, 2003

Israel - The Ministry of Finance is stepping up its pressure on the Histadrut (General Federation of Labor in Israel) and its older pension funds. Supervisor of Insurance Eyal Ben-Chelouche today unexpectedly announced the appointment of special temporary supervisors for the management of the older pension funds, which have an aggregate actuarial deficit of NIS 140 billion.

The appointments, which were coordinated with Attorney General Elyakim Rubinstein, are until the appointment of authorized managers for the older pension funds, under the pension arrangements passed by the Knesset last week, as part of the economic recovery plan.

Ben-Chelouche appointed Meir Harnoy CPA as special supervisor for the Makefet Fund, Yaron Arbel as special supervisor for the Histadrut pension fund, Ilan Segal CPA as special supervisor for the Mivtachim Pension Fund, and Reuven Swary CPA as special supervisor for the Pension Fund for Agricultural Workers & Non-Professionals.

The appointment of special supervisors was approved by Minister of Finance Benjamin Netanyahu. The Ministry of Finance said the appointments were designed to protect the interests of the funds’ members and reinforce public confidence, while preserving the security of the members and pensioners. Ben-Chelouche said that the appointments were also intended to guarantee a stable pension system.

The supervisors will accompany the funds’ management during the transition period, until the public committee, headed by a judge, to be established under the new law, selects the authorized managers for the funds. Under the new law, the special authorized managers shall be appointed no later than August 1, and will replace the current managers of the older pension funds.

Netanyahu yesterday discussed with a group of economics professors the effect of the pension reform on the capital market.