Bombshell report details excessive spending by prime minister

Israel’s State Comptroller issued a scathing report on Tuesday substantiating complaints of financial improprieties on the part of Prime Minister Benjamin Netanyahu at his homes in Jerusalem and Caesarea.

The report sparked an immediate political firestorm, with opposition leaders saying it showed Netanyahu unfit to hold office — “thoroughly disconnected from the people,” in the words of Yesh Atid’s former health minister Yael German. Netanyahu loyalists, for their part, suggested the prime minister was the victim of a witch hunt, with Likud minister Yuval Steinitz suggesting the comptroller had been pressured into releasing the report in the run up to elections in order to harm Netanyahu.

The highly anticipated report states that expenditures at the Prime Minister’s Residence have been excessive and improper, highlighting excessive spending on food, cleaning and clothing among other areas, and that budgetary practices have not been carried out with integrity and transparency.

The comptroller highlighted and criticized, for instance, hundreds of thousands of shekels spent annually on takeaway food, even though the residence employed a cook; excessive spending on the couple’s home in Caesarea, even though it was only used at weekends; and the employment of a Likud Central Committee member, Avi Pachima, as a private electrician on the weekends and even on Yom Kippur at the Casearea home. He also noted with dismay an instance where a staffer had to pay for eye drops for the prime minister and was not recompensed.

The report also finds deficiencies in the administrative practices of the Knesset, as well as in certain areas of financial management and management of human resources at the President’s Residence.

Released exactly a month before elections, the bombshell paper could potentially hurt Netanyahu in the polls and could lead to legal action.

“This report, in itself, will not bring down Netanyahu,” Channel 2 commentator Udi Segal said Tuesday afternoon. The question, Segal said, is how much it might add to a cumulative sense of dissatisfaction with the prime minister. At present, polls show Netanyahu likely to lead the next coalition, and by far the preferred choice of prime minister over Zionist Union leader Isaac Herzog.

All the evidence supplied to State Comptroller Yosef Shapira for the writing of his report was forwarded to the Attorney General’s Office at the request of Attorney General Yehuda Weinstein, out of concern that it could point to possible illegalities, the report states.

The report shows total expenditure of the Prime Minister’s Residence rising from NIS 1,860,000 (some $475,000) in 2009 to NIS 2,400,000 ($615,000) in 2010 and NIS 3,114,000 ($798,000) in 2011. It fell to NIS 2,864,000 in 2012 and NIS 2,410,000 in 2013. Spending on food and hospitality more than doubled in 2010 and 2011 compared to 2009.

Netanyahu has faced scads of criticism in the press and from political opponents over reports of excessive use of state coffers, including NIS 80,000 ($20,000) a year on water at his home in Caesarea, a NIS 10,000 ($2,500) a month budget for ice cream and a flight on which he spent NIS 450,000 to have a bed put in a plane for a five-hour flight.

On Sunday, the Netanyahus aimed to do pre-emptive damage control by releasing a video claiming to show the dilapidated state of the Prime Minister’s Residence, though it was met with some derision.

Responding to the report, the Likud party blamed the increase on spending on house caretaker Menny Naftali, who is currently suing the Netanyahus over abuses while he worked in the Prime Minister’s Residence, and said recommendations in the report were either already implemented or being implemented.

“It is important to note the expenses of the Prime Minister’s residence have been reduced significantly over the past two years. The expenses significantly increased during a specific period of time when the house’s maintenance and operation were directed by Mr. Menny Naftali –- an embittered former public employee. Mr. Naftali is currently leading a campaign of slander and defamation against the prime minister with the specific goal of illegitimately leveraging his claim for financial gain from the State coffers and to damage the prime minister and the Likud party during this period of Knesset elections. The expenses of the Prime Minister’s residence were reduced significantly following Mr. Naftali’s departure from his former position,” the statement read.

In particular, the report found spending by the Prime Minister’s Residence on catered and take-away meals, as well as on cleaning, to be excessive. It also found that the public funds were improperly spent on purchases for prime minister himself.

In his introduction to the report, Shapira emphasized that auditing the Prime Minister Residence’s finances was difficult due to poor management and budgeting practices.

“The audit found that the budget for the residences for 2009-2012 were made without a process that analyzed needs or determined estimated expenses. This did not meet a single criteria for the rules of proper management, and hurt the ability to carry out proper auditing and oversight,” wrote Shapira, referring to spending on both the official Prime Minister’s Residence in Jerusalem and Netanyahu’s private home in Caesarea.

It was only in 2014 that the residence took the initiative to publicize an annual budget.

Photographs of Prime Minister Benjamin Netanyahu’s residence from a meeting of Likud leaders on Feb. 11, 2015 were leaked to Army Radio. Some believe the photos were deliberately sent to the reporter to combat the recent attacks on the prime minister’s luxury. (Screen capture: Ido Benjabi/Army Radio Twitter)

According to the report, expenditures by the Prime Minister’s Residence on food and official hosting rose from NIS 211,000 ($54,585) in 2009 to NIS 409,000 ($105,800) in 2011. In 2012 they were slightly lower, and by 2013 they had dropped to NIS 226,000 ($58,465) following media reports, as well as inquiries by the State Comptroller’s office.

In 2010, the Netanyahus were ordering in NIS 71,851 ($18,600) worth of prepared meals (one quarter of the PM’s Residence’s food expenditures), despite the fact that they had a cook on staff. By 2011, the catering bill had gone up even further to NIS 92,781 ($24,000).

“In light of the considerable drop in expenditures in 2013, it can be determined that the household expenditures on the prime minister, his family and guests at the official residence, especially in 2010 and 2011, and to a lesser extent also in 2012, did not meet a single criteria of the basic principles of proportionality, reasonableness, economy and efficiency,” wrote Shapira.

Shapira was highly critical of the amount of money the Netanyahus spent on house cleaning. Despite the fact that the family lives most of the time in the official residence in Jerusalem, they have been paying an average of NIS 8,200 ($2,120) per month for the cleaning of their private home.

Other areas in which the prime minister and his family were excessive and irresponsible with public monies are water consumption, makeup and hairstyling, and electrical repairs at their private home.

In addition, it was found that employees of the Prime Minister’s Office were not reimbursed from petty cash for expenditures they made on the prime minister from their own pockets.

View of the Prime Minister’s Residence in Jerusalem on June 23, 2009 (photo credit: Yossi Zamir/Flash90)

The state comptroller announced he would release the report last month after a revelation that Sara Netanyahu had allegedly pocketed deposit money from recycled glass bottles resulted in a media firestorm.

The State Comptroller confirmed that Sara Netanyahu reimbursed the PMO in the amount of NIS 4,000 ($1,035), which she received from bottle recycling redemptions.

Shapira emphasized that despite no clear protocols about bottle redemptions, as well as the relatively low sum involved, these are still public funds and should be returned to the state’s coffers.

The report also clarified that a set of patio furniture identical to the patio furniture at the official residence was purchased and delivered to the Netanyahu’s private residence.

Once media reports about this surfaced, the new set was removed from the private home and moved to the official residence.

Shapira pointed to this as an example of how there is evidently no system in place to keep track of inventory purchased by and for the Prime Minister’s Residence.