The director of the Government Companies Authority, Michal Rosenbaum, spoke out strongly on Monday against Communications Minister Shlomo Krei's plan to oust Israel Post Chairman Mishael Vaknin, about three weeks before the planned date for publishing the sale procedure. The incident came after the communications minister claimed that postal service levels were at an all-time low since he took office.
In an opinion sent by Rosenbaum to Minister of Communications and Minister of Regional Cooperation Dudi Amsalem, titled "The Government Companies Authority's Position Before Holding a Hearing for the Chairman of the Board of Directors of the Israel Postal Company," Rosenbaum wrote that "there is no basis in our opinion for your claim that Mr. Vaknin is not properly fulfilling his role as Chairman of the Board of Directors of the Company, and therefore there is no basis for his removal from his position."
Israel Post (illustrative), photo: Yehoshua Yosef
The opinion was forwarded, inter alia, to Finance Minister Bezalel Smotrich; Shlomi Heisler, Director General of the Ministry of Finance; Maimon Shmila, Director General of the Ministry of Communications; Yogev Gordos, Director of Budget at the Ministry of Finance; Yali Rotenberg, Accountant General of the Ministry of Finance and more.
Rosenbaum added in the opinion: "The stability and managerial continuity of the company (Israel Post) is critical for the continued implementation of the recovery plan and the end of privatization. In light of the announcement by the company's CEO (David Laron), who is also taking a central part in these important processes of the company, that he too will leave his position at the company as long as the role of chairman of the board of directors is terminated, the removal of the chairman of the board from his position at this time is expected to harm the continued implementation of these processes, and in any case the company and as a result the state coffers and the taxpayer."
"As another central consideration in the Minister's decision to consider removing Mr. Vaknin from office, it was noted in the first paragraph of the draft hearing letter that the Minister of Communications has no confidence in the ability and policy adopted by the company's board of directors, headed by Mr. Vaknin. It should be emphasized that the position of chairman of the board of directors is not a position of trust, and lack of trust is not grounds for removing the chairman of the board of directors of a government company."
Karai does not spare criticism from Smotrich and senior finance officials, photo: Oren Ben Hakon
About a week ago, the Minister of Communications issued a letter addressed to Shlomi Heisler, Director General at the Ministry of Finance, Yogev Gradus, Commissioner of Budgets, and Yali Rotenberg, Accountant General at the Ministry of Finance. In a letter that comes in response to their warning earlier this week that the removal of the chairman of the post office would undermine the company and jeopardize the planned privatization of the postal company, Qari criticized senior finance officials, including its head, Minister Bezalel Smotrich, for "not bothering to pick up the phone to the minister. The company's supervisor, supervisor and regulator, before they decided to send him a second letter within 3 months, all just to protect the failed activity of the postal company, which harms the customer public and the company's reputation."
In the letter, Karai noted that "after examining for several months, I have decided, as someone who is in charge and responsible for the company both under the Postal Law and the Government Companies Law, to initiate a hearing process for the chairman of the company's board of directors prior to his removal." "Had you not stuck sticks in the wheels of the hearing process for several months, we could have already been in the process of privatization, to the satisfaction of all parties," he said.
Shlomi Heisler, Director General of the Ministry of Finance. Karai did not back down, contrary to his position, Photo: Oren Ben Hakon
At the beginning of her opinion, Rosenbaum wrote that before discussing the merits of the claims, "I would like to point out what should be understood by all those involved in the work. The temporary order is the launch of the public phase of the privatization process, the execution of which without delay is critical to the company's future, financial stability and ability to continue providing postal services to all residents of the country.
This is after the State of Israel invested billions of shekels in order to harm the service to the public and the thousands of dedicated employees. From this it is clear that the public interest requires the rapid completion of the privatization process, in the framework of which the company will be sold to a private investor in full. After extensive work carried out to promote privatization, led by the Companies Authority and in cooperation with all parties involved in privatization, including the company, we are only about three weeks ahead of the planned date for publishing the sale procedure, while meeting deadlines, unprecedented compared to previous privatization proceedings."
Regarding the company's situation, she wrote, "The company recently published its financial statements for the first quarter of 2023. These reports show a significant improvement in revenues: about NIS 436 million in the first quarter of this year, compared with NIS 390 million according to the budget and NIS 382 million in the corresponding quarter of last year, and even beyond net profit of NIS 23 million. This follows seven consecutive quarters of loss, with the expectation of a transition to net profit only in the second half of 2023. Even earlier, in 2022, the auditor's report, the going concern note, was removed from the auditor's report and the external financing system, which until recently was in danger of immediate repayment, was stabilized."
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