Finance Minister Ronnie Bar-On reluctantly announced a limited safety net for pension funds on Sunday, revising an economic stimulus plan that had prompted Histadrut Labor Union leader Ofir Eini to threaten a general strike of the entire public sector.
Bar-On, who expressed concern that the move would be seen as "election economics", maintained that the amendment was unnecessary and had been forced upon the Ministry by political pressure.
The Histadrut decided to declare a work dispute Sunday anyway despite the move. The decision initially came following the release of Bar-On's economic stimulus plan that had ignored the union's demand for a "security net" for pension funds which have lost more than 20 percent of their value in the market crash over the past several months.
The formal declaration of a work dispute sets the stage for Eini to call a general strike in two weeks' time if he decides the Finance Ministry's measures are inadequate. Reportedly the strike, if it comes to fruition, may also include private sector workers, such bank employees and workers in various industrial settings. The declaration will go to the Histadrut's leadership for a vote on Tuesday.
"Economists and the public believe that there is an immediate need for the implementation of a pension safety net," said Eini," in particular for those who are nearing retirement age and are seeing their savings disappear."
Finance Ministry officials maintained that the protection is not necessary and carries with it its own set of risks, including the possibility of a commission of inquiry into the performance of those who carried out the safety net measures, should the plan fail to meet its goals.
In addition, there will be no retroactive protection for those who have already lost money due to the market crashes in 2008. "It would be impossible to return the losses... considering the vast sums of money," said a source in the Finance Ministry.
Ministry officials also expressed concern that the plan improves the situation of workers who have already accumulated considerable savings, at the expense of those who have little or none.