Bill allowing lawmakers to accept gifts to pay legal fees advances on Knesset floor

Law widely seen as way for Netanyahu to raise new funds for defense in graft case after court orders him to return $270,000 gift; AG cautions amendment opens door for ‘corruption’

Carrie Keller-Lynn is a former political and legal correspondent for The Times of Israel

Prime Minister Benjamin Netanyahu in the Knesset plenum, March 1, 2023. (Yonatan Sindel/Flash90)
Prime Minister Benjamin Netanyahu in the Knesset plenum, March 1, 2023. (Yonatan Sindel/Flash90)

Despite being slammed by the attorney general as paving the way for corruption, a bill that would let public officials receive some financial gifts cleared its preliminary reading in the Knesset on Monday by a vote of 53 to 9.

While lawmakers claimed the bill is meant to remove discrimination against lawmakers, it is widely seen as a way for Prime Minister Benjamin Netanyahu to raise funds to pay for his legal costs in his corruption trial after a court ordered him to return a $270,000 gift that his late cousin and benefactor, Nathan Milikowsky, gave him to pay for legal fees.

In 2021, the High Court of Justice ordered Netanyahu to return the funds to Milikowsky’s estate, after ruling they were an improper gift. Netanyahu had been ordered to return the sum by February 2023.

While the law is not expected to be retroactive nor to void the court order, “once it passes, he will immediately be able to raise the money again,” according to Israel Democracy Institute political reform program head Assaf Shapira.

The premier was absent from the plenum for Monday’s vote, as was Likud MK David Bitan, currently under indictment for alleged corruption and financial offenses.

Shortly before the government formally backed the bill on Sunday, Attorney General Gali Baharav-Miara assailed the proposal, writing to a government panel that it “has the potential to open a real door to governmental corruption.” Baharav-Miara wrote that her office further cautioned that the bill is “harmful” and “contrary to the purpose of the [existing public servant gifts] law.”

Sponsored by Netanyahu’s Likud party, party politicians came out in full force to support the amendment to the current law governing gifts to public servants.

Public Information Minister Galit Distel Atbaryan told the Knesset that allowing donations to pay for legal or medical expenses can help sick children and “doesn’t obligate us to anyone, there’s no capitalist cronyism.”

Attorney General Gali Baharav-Miara at her inauguration ceremony in Jerusalem on February 8, 2022. (Yonatan Sindel/Flash90)

The attorney general reached the opposite conclusion in her letter to Justice Minister Yariv Levin and the government panel he chairs to determine the coalition’s stance towards legislation.

The bill’s official sponsor, Likud lawmaker Amit Halevi, said the amendment would give public officials similar rights to a layperson.

“If you’re a public official, are we no longer people?” Halevi asked regarding the ability to receive financial gifts for legal and medical expenses. “Above everything, we are people.”

Lawmakers are eligible for comprehensive medical treatment like all other citizens under the national healthcare system.

Lawmaker Ayman Odeh from the Hadash-Ta’al opposition party attacked the proposal, implying it would become a gateway for people with means to gain influence over politicians.

“What do you tell someone who has millions and is looking for an investment? Make the most of your money,” Odeh said to the Knesset.

Yisrael Beytenu party chief Avigdor Liberman criticized the premier for his government’s promotion of the bill.

“Instead of contributing to security, the economy and the welfare of the citizens of Israel, Bibi is busy contributing towards himself and his family,” Liberman tweeted, using the Hebrew word that is synonymous for “contribution” and “donation.”

“There is no law more worthy of being struck down by the Supreme Court, and I expect it to be,” the opposition party leader continued.

Netanyahu’s government is locked in a battle to reframe the High Court of Justice’s scope of power, including its ability to exercise judicial review over laws passed by the Knesset.

In addition to letting public officials receive financial contributions for legal proceedings or necessary medical expenses, the change would also allow gifts to other members of a public servant’s family, and minor crowdfunding campaigns, for the same reasons.

The proposal would bar a public servant from receiving funding from a corporation or a minor, or contributions made in cash. It would also disallow anonymous contributions of over NIS 2,500 (around $720).

Milikowsky gave the Netanyahus $300,000 from 2017 to 2018, and was later paid back $30,000. He died in July 2021 at the age of 78.

Justices also ruled last year that a NIS 2 million ($566,000) loan Netanyahu received from real estate mogul Spencer Partrich was a forbidden gift, but could be repaid according to their agreement, with supervision from the state comptroller, since the loan had been approved by the comptroller and attorney general.

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