At the State of Israel's non-government organizations (NGOs)
anything goes. From party fundraising for political parties
to running building committees and public institutions, they
have total freedom of activity. Although there is an NGO
Registrar responsible for oversight, he cannot tell an NGO
what goals to work towards nor what to do with the funds
entering its coffers.
It seems perfectly simple. One goes to the registrar, lists
the name of the NGO (amuta) and its objective, pays a
nominal fee and then the money starts coming in. The NGO just
has to declare its goals (in terms of public affairs, not
economic or politic goals) and it is off and running.
An NGO must have seven members, including a chairman and an
internal comptroller. Every year a financial report must be
submitted, describing the organization's activities. Some
NGOs even earn large sums every year but unlike companies,
profits are not divided among investors or shareholders but
directed toward the goals for which the NGO was set up. In
some cases the organization may be eligible for government
funding to promote its activities if it meets certain
criteria and if the NGO Registrar certifies it is properly
managed.
The oversight that exists for public companies and government
companies is almost nonexistent in the case of NGOs. Nobody
knows exactly where the money goes. Some say the NGOs can be
used for money-laundering. Also NGO directors can receive
exorbitant salaries, sometimes tens of thousands of shekels
per month or more.
Recently the NGO Registrar's report was released. Twenty
thousand NGOs are registered in Israel, of which 13,000 are
active. Many public organizations such as hospitals and
educational institutions operate under NGOs. In order to
skirt supervision over the salary of ranking officials,
directors of the NGOs receive enormous salaries that could
sustain many families.
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The State of Israel funds private and public NGOs in the
amount of about NIS 4 billion per year. Not all of the funds
transferred to the NGOs reach their destination according to
the director's declared intentions. There is no disclosure
policy to allow government ministries to supervise what takes
place at the NGOs.
There is one piece of information the NGO Registrar can find
out about and which the directors are even required to
report: the salaries of ranking officials, generally at NGOs
that receive enormous budgets from the state. For example,
according to a report in Ma'ariv that included parts
of the Interior Ministry's report on the NGOs, one of the
officials of the NGO that operates Shaarei Tzedek Hospital
receives a monthly salary of NIS 130,000 ($30,000). The
hospital director receives the same amount. In total the top
five officials are paid NIS 6.2 million ($1.4 million) per
year.
Another NGO where the top officials are living it up with
astronomical salaries is Neshei Amit (Amit Women's
Organization), which runs a network of religious schools in
various parts of the country. Neshei Amit receives NIS 20
million ($9 million) annually in state funding. And where
does this money go to? Twelve percent of it goes to pay the
salaries of the top five officials, who together receive NIS
2.4 million ($550,000). The network of schools suffers from
deficits and from cuts in worker salaries while its top five
executives receive an average monthly salary of NIS 40,000
($9,100) and its highest paid executive receives NIS 62,000
($14,000) per month.
Likewise the Alyn Orthopedic Hospital for Handicapped
Children in Jerusalem grants an a monthly salary of NIS
73,000 ($16,700) to one of its top-ranking administrators.
One of the better-known organizations in the Israeli
establishment is the Israeli Institute for Democracy, which
preaches the cause of lawful and democratic conduct in
government institutions. One would assume the organization's
executives would do the job voluntarily. In fact the
Institute, which does not receive government funding but as a
unique institute does receive tax benefits, pays its
president a sum of NIS 118,000 ($27,000) per month.
No chareidi NGOs appear on the list of organizations with
enormous top-end salaries. Chareidi organizations set up NGOs
for the sake of education and chesed, utilizing every
cent received to further these aims. Meanwhile secular and
national-religious bodies take full advantage of the funds
funneled in to reward their top officials. At some NGOs half
of the money they spend goes to the salaries of the top
executives.
Welfare NGOs such as Babayit, MATAV and even the disabled IDF
veterans' association pay their top-ranking officials monthly
salaries of over NIS 45,000 ($10,300). Sports teams also pay
high salaries. At an NGO that runs a team in Tel Aviv the
highest-paid figure receives NIS 145,000 ($33,000) per month.
In total its top five officials receive more than NIS 5
million annually. At another team from Herzliya the highest-
paid figure receives NIS 1.4 million per year.
Secular educational institutions are similar. At Beit Berl
College, for instance, the top-paid administrator receives
NIS 581,000 ($133,000) per year, while the next five best-
paid administrators receive a total of NIS 2.37 million
($615,000) per year. A similar institution, the Kibbutzim
Seminary, pays as much as NIS 583,000 ($133,000) per year and
the top five administrators receive of total of NIS 2.21
million ($505,000). At WIZO the top-paid administrator
receives NIS 750,000 monthly and the next five in line are
paid a total of NIS 2.64 million ($600,000) annually. NGOs
that run cultural institutions, such as the New Israeli
Opera, also dole out generous salaries. The Opera, which
receives an annual budget of NIS 17 million ($3.9 million),
pays as much as NIS 55,000 ($12,600) per month.
National-religious institutions also appear in the report on
the list of extremely high salaries. One of the hesder
yeshivas pays NIS 450,000 ($103,000) per year to its
highest-paid figure and its top five salary recipients earn a
total of NIS 2 million ($460,000) annually. At the Emuna
Women organization, the top salary comes to NIS 715,000
($163,000) and the top five executives receive a total of NIS
2.5 million ($570,000).
Voluntary organizations also pay big salaries. The
Association for the War Against Cancer pays its director NIS
350,000 ($80,000) annually. AKIM paid its top salaried
executive NIS 29,000 ($6,600) per month.
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Little can be done to counter these excesses. According to
the law the state cannot interfere in these organizations'
affairs or determine the salary of the NGOs directors and top
executives. This is a legal matter that raises numerous
problems. The only avenue that remains is to publicize the
names of the executives who earn exorbitant salaries to
inform people who donate money to these organizations how
their money is being spent.
According to the Registrar's office some NGOs engage in
public fundraising in addition to the enormous budgets they
receive from the government and pay generous salaries. In
2002 the director of Pitchon Peh, for example, received an
annual salary of NIS 250,000 ($57,000). More than half of the
donations to the organization go to the salaries of its top
five executives.
For the last five years NGOs have only received state funding
if they have a "proper management" certificate from the NGO
Registrar. But the law does not allow the Registrar to
investigate who makes donations and certainly not how much
each donator gave.
So far the government has not managed to clamp down on top-
ranking salaries although a committee was set up two years
ago to investigate the matter and even recommended amending
the law that restricts the wages for top NGO figures.
Minister Meir Shetreet, who called for a draft of the report
that has been prepared but is not yet finished, claims the
findings in the inquiry were astounding. At all of the NGOs
the salaries of the top three figures were checked and in
several cases more than 50 percent of the total budget went
toward paying these salaries. "It cannot be that the state
budgets funds to NGOs and at some of them the majority goes
to their directors' pay," says Shetreet, who notes there are
NGOs that do not receive any money from the state but pay
high salaries.
On the other hand NGOs enjoy tax exemptions. In an interview
with Ma'ariv Minister Shetreet said, "We must create a
limit on the salary level of NGO directors. The system has to
be changed from the foundations. Especially during these
difficult times of painful budget cuts, it is difficult to
accept the report's findings on NGO directors who are living
at the public's expense."
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Yet there are also some who defend the enormous salaries of
many directors at various organizations. Take, for example,
120 NGOs in the State of Israel that deal in welfare and aid
money for poor families and individuals. The directors of
these NGOs do what the government was supposed to do. "You
cannot get talented/capable directors at minimum wage," says
Sarah Zilberstein, who serves as director-general or the
umbrella organization for voluntary associations and the non-
profit organizations.
She also says companies set up especially for this purpose
charge/collect money from the public for NGOs. These
companies receive percentages for collecting donations; an
entire industry has emerged that brings in hundreds of
millions of shekels annually--all at the expense of the
public, which contributes and contributes to these NGOs
without always knowing where there money goes. Generally this
kind of fundraising is conducted through telemarketing.
Every few days the phone rings with a call from one
organization or another asking for contributions. Typically
the caller represents a telemarketing company seeking
donations for NGOs, which pay for every shekel they bring
in.
Although at chareidi NGOs -- typically Torah, chesed
or educational institutions -- mega-salaries are rare (and
not found in the report at all) and they are constantly
facing budget deficits, when they request funds rightfully
theirs by law some enemies of religion invariably leap up to
gripe about funding to chareidim. Yet when the state budgets
NIS 4 billion ($900 million) annually to NGOs (the vast
majority of which are not chareidi), and up to half the
organization's budget may be spent on exorbitant salaries for
its top- ranking figures, not a word is said. Except for a
few scant lines in the newspaper about scandalous salaries,
nobody pays much attention.
It appears the religious alienation fostered by the media and
the Israeli establishment is not about to change--not before
important Torah, chesed and educational institutions
collapse under their financial burdens, while sports, dubious
cultural organizations and theaters will continue to thrive
off tremendous funding and sky-high salaries.
