As the controversial budget bill was taken up by the Knesset for final review, Finance Minister Yair Lapid became a subject of controversy on his own as allegations of corruption filled the air.
During the plenum debate, United Torah Judaism MK Rabbi Yaakov Litzman cited media reports that the Knesset Finance Committee recently approved a grant of 1.5 million shekels for businesses that belong to close associates of the finance minister.
According to a report in Globes, the Finance Committee approved financial support for small beer breweries as a compensation for the increased tax on alcohol consumption.
Hillel Kobrinsky, a senior economic adviser to Lapid who participates in Ministry of Finance meetings, owns 4% of Abeer Habar, and is the owner of Alexander Beer, an Israeli microbrewery. The company is the largest brewery among the recipients of the aid.
According to the report, the aid was approved barely a week after the tax was announced. Such speed is unheard of in Israeli bureaucracy. In addition, the request came to the Finance Committee without previously being scheduled on the agenda, the day after Kobrinsky and another partner in the company, advertising executive Yoram Bauman, met with deputy Finance Minister Mickey Levy, also from Yesh Atid. Bauman managed the Yesh Atid campaign for the Knesset elections.
According to the Finance Committee meeting protocol, the allocation took less than five minutes. Committee MKs wondered why the breweries are being singled out for aid; after all, many companies are affected by taxes added to their products and are not compensated for their loss.
Alluding to Lapid’s inexperience in government, Rabbi Litzman said, “I must draw the Knesset’s attention [to this matter]: Minister Lapid learned very quickly how to direct money to his friends through the Finance Committee … in less than two months on the job.
“Lapid preaches to everyone else, but I say: The corrupt ones should go home!”
He said it was a miracle that the Israeli media, until recently former journalist Lapid’s own colleagues, published the story.
Rabbi Litzman quoted MK Shaul Mofaz (Kadima) to the effect that reserve sums in the amount of 13 billion shekels are to be found in the ministries controlled by Lapid’s Yesh Atid party.
“Is this also the new politics? What is this money? What does this show? That [his austerity program] is all politics!”
Globes, which ran the story about the beer benefit, said on Thursday it will petition the courts for disclosure of the conflict of interests agreement signed by businessman Kobrinsky.
In response, Lapid’s associates are denying any wrongdoing. Nilly Richman, Lapid’s spokesman, said that Kobrinsky and Bauman will countersue Globes.
Yesh Atid’s spokesman said that allocation is legal because the Finance Committee members were not aware that Kobrinsky was a partner in the brewery, and the allocation is not a large amount. The party said in a statement that the initiative to aid the small breweries was made by Finance Committee member Adi Kool — also from Yesh Atid — because naturally, small firms are disproportionately hurt by tax increases.
Meanwhile, it has also come to light that two guarantors of Yesh Atid, Nir Brunstein and Ron Weisberg, are also partners in Alexander Beer, Globes said.
In addition, The Movement for Quality Government in Israel asked Attorney General Yehuda Weinstein and State Comptroller Joseph Shapira to review the decision-making process at the Ministry of Finance in relation to aid for microbreweries. The organization says that the report raises “concern of flawed ethical conduct and raises suspicion of inappropriate and improper conduct.”
In the request, The Movement for Quality Government states, “An uncomfortable feeling emerges, to put it mildly, about the closeness of some of the owners of the dominant breweries involved in the process to the finance minister himself and to his party, especially when this has not been disclosed, to the best of our knowledge, nor brought to the attention of the decision-makers when this was approved. We note that ties of tycoons to the top political leadership, even if they are engaged in ostensibly ‘minor’ decisions, with a limited financial cost, should be known and disclosed in order to prevent concern or even the appearance of distortion or bias.”