Lapid unveils plan to reform government-run companies

Lapid: Stopping political appointments and jobs will bring the old politics of corruption in government to an end.

November 5, 2013 20:21
1 minute read.
Finance Minister Yair Lapid at the Knesset's Finance Committee, June 11, 2013.

Lapid at Finance C'tee meeting 370. (photo credit: Knesset)

Finance Minister Yair Lapid unveiled a plan to eliminate political appointments in favor of professional appointments and government-run companies’ boards of directors.

“Stopping political appointments and jobs will bring the old politics of corruption in government to an end,” Lapid said. “Establishing elected directors will allow us to build professional, well-managed, profitable government companies that will provide added value to the Israeli public and put profit in their pockets and the pockets of the state, simply because they are managed better and will be more professional.”

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Starting next week, the process of searching for candidates will begin. They will be examined, filtered according to professional criteria, and whittled down into a database with equal representation between men and women, and 10 percent minority candidates. Those who make it through the process will be eligible to join boards of directors.

According to the Finance Ministry, Israel’s government- run companies, which include Israel Railways, the Israel Electric Corporation, the postal service and the Israel Port Authority, are less profitable than those of other Organization for Economic Cooperation and Development-member countries. Norway, for example, squeezes five-anda- half times the profit out of its government-run companies.

Boards will ideally have a mix of managers, academics, area-specific experts, finance people and people with government experience.

The government runs over 100 companies comprising assets of NIS 183 billion and employing 60,000 people.

Of the 900 board slots, 500 are unfilled.

Ori Yogev, who directs the Government Companies Authority, said the agency would take on a more professional role, not simply a regulatory one, bringing it more in line with OECD standards.

“This move is one of the central challenges I set for myself as part of my return to public life,” Yogev said.

“The goal is to create good, efficient and more profitable companies. Today, this is the first step in realizing that vision.”

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