A report published today (Monday) by the State Comptroller Matanyahu Engelman Revealed financial deficiencies of some of the parties in the parties’ primaries held in 2019 and funded by some of the parties that ran in the local elections in October 2018, along with current accounts audit reports of the factions in the 20th Knesset.
During the audit of the State Comptroller’s Office, the accounts of 296 candidates who ran in the primary elections in five parties for the 21st Knesset were examined – the Jewish Home, the Likud, Labor, Identity and Meretz.
This year, for the first time, the change in the law was implemented that allows eligible candidates (including incumbent Knesset members) to receive funding from the state for the expenses of the primaries. The report claims that out of 266 candidates who ran in the elections for the position of MK for the 21st Knesset, in the conduct of 195 of them no deficiencies were found, while in 71 it was alleged that deficiencies in their accounts.
According to the candidates’ reports, the income from donations received by them to finance their activities in the primary election amounted to NIS 6.7 million, of which 4.8 million were donations from self-financing and family members, another 1.4 million were donations from Israel and about half a million were from abroad.
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In addition, the Ministry of Finance awarded grants totaling NIS 14.6 million, of which NIS 10.6 million to candidates in the Likud primary elections, NIS 3 million to candidates at work and NIS 890,000 to candidates in March. The State Comptroller notes in the report that 28 candidates exceeded the recognized expenditure ceiling in the total amount of NIS 1.06 million.
The report notes favorably that all the candidates in the party’s chairman – Benjamin Netanyahu in the Likud, Amir Peretz in Labor and Nitzan Horowitz for Meretz (a total of 8 candidates for the chairmanship) did not exceed the allowable donation ceiling.
However, the report criticizes the use of the Prime Minister’s Residence in favor of a Prime Minister’s political conference during the primaries. The Comptroller emphasizes that the use of the Prime Minister’s Residence for multi-participant election conferences should be avoided. The Prime Minister’s force stated that they would avoid this in the future.
Prime Minister Netanyahu’s remarks at the beginning of the cabinet meeting
Another report dealt with criticism of 15 factions that received funding for participating in the local elections in October 2018, including: Degel HaTorah, Balad, the National Union, the Jewish Home, the Likud, Agudat Israel, Ta’al, Hadash, Yesh Atid, Yisrael Beiteinu, All of us, the Labor Party, Meretz, Ra’am and Shas.
In four of them, defects were found for which fines were imposed. Agudat Israel issued a prohibited expense due to non-repayment of a loan it gave to the faction on a joint list on the date set by law, and the faction was fined NIS 40,000. The Likud was found to have a defect due to the lack of references establishing the adequacy of the consideration paid by the faction for polls and the faction was fined NIS 100,000.
The Labor Party found a defect in respect of income that does not meet the limits of the law received from candidates in subsidiary factions that exceeded the budget, and the full income and expenses of one of the subsidiary factions were not included and the faction was fined NIS 100,000. RAAM exceeded the spending ceiling and the faction was fined NIS 26,000.
The parties reported NIS 2.4 million in income from donations. The Comptroller also notes that following the changes in the party funding rate, the total expenditure on the 2018 elections increased by NIS 50 million compared to 2013, and state funding increased from NIS 92 million to NIS 165 million.
Despite this increase, the parties ended up with a deficit of NIS 12.5 million. The largest deficits starred the Likud with a deficit of NIS 15.7 million, Degel HaTorah with a deficit of NIS 3.8 million, the Jewish House with a deficit of NIS 870,000, Agudat Israel with a deficit of NIS 780,000 and Ra’am with a deficit of NIS 688,000.
Matanyahu Engelman in the State Audit Committee (Photo: Adina Wallman, Knesset Spokeswoman)The comptroller also audited the current accounts of the factions in the Knesset during 2018, stating that for 14 of the parties the reports were positive and only two parties – the Likud and Balad – were not given positive reports, claiming the deficiencies for which fines were imposed. NIS 100,000 and for Balad – NIS 25,000.
In the Likud, because of the “Likud Diad” event, the party did not meet the restrictions set forth in the law regarding the receipt of donations, a fine of one hundred thousand shekels was imposed on the party. In Balad, the Comptroller determined that the faction’s accounts included exceptional expenses that did not meet the definition of expenses according to the law, for a summer camp organized for children and which included a real direct financial benefit for the participants.
The comptroller stated that this leads to the conclusion that there is a direct financial benefit of considerable value to the families of the participants and fined the party NIS 25,000.
The 5 factions had a cumulative deficit for 2018 in the total amount of NIS 24 million, led by the Jewish House with NIS 20 million, Degel HaTorah with NIS 1.3 million, RAAM with NIS 1.3 million, Agudat Israel – NIS 1 million and Balad with NIS 420,000.
The report criticized the fundamental issue of the involvement of assistant ministers and parliamentary advisers in the primary elections, without their involvement being reflected in the candidate’s expenses. The Comptroller believes that this harms equality between the candidates.
Following the alleged deficiencies found in the audit, the State Comptroller imposed a fine of NIS 25,000 on MK Nir Barkat (Likud), alleging non-registration of expenses, lack of references to expenses and exceeding the expenditure ceiling.
The comptroller imposed additional fines due to various alleged defects in the reports, or their non-submission. An MK from the Likud was fined NIS 22,000, Osnat Mark (Likud) NIS 13,000 and Petin Mula (Likud) NIS 13,000 and a refund of NIS 39,331. NIS.
Salah Saad (Labor) was fined NIS 7,000, Etaf Krinawi (Likud) NIS 7,000, Katie Sheetrit (Likud) NIS 7,000, Nazar Elimi (Labor) NIS 7,000, Gur Minzer (Meretz) NIS 6,000 and Yaron Mazuz (Likud) – NIS 6,000.
The data show that the revenues of all parties from state funding in 2018 amounted to NIS 133.9 million and the revenues from membership fees – 12.8 million. The five factions had a cumulative deficit for 2018 in the total amount of NIS 24 million: the Jewish House – NIS 20 million, Degel HaTorah – NIS 1.3 million, Halaram – NIS 1.3 million, Agudat Israel – NIS 1 million and Balad – NIS 420,000.
The parties with the largest commitments were the Likud – 29 million, the Jewish House – 20 million, Shas – 18 million, all of us – 16.4 million and Yesh Atid – 13.6 million.