Pension Reform (2008)
The mandatory pension enrollment reform that shifted Israel from voluntary to compulsory employer-funded pension coverage for all employees — creating the institutional capital base that anchors the TASE.
Before 2008, pension enrollment in Israel was voluntary — and large portions of the private-sector workforce had no retirement savings at all. The 2008 reform (Tzav Harchava L'Pnsia Chovah) made employer-funded pension contributions mandatory for every employee, phased in over several years and reaching full rates by 2014. Current mandatory contribution rates (2026): employer contributes 6.5% of salary to pension plus 6% toward Section 14 severance; employee contributes 6%. These deposits flow through Kupot Gemel, Kranot Hishtalmut, and pension funds via the maslaka clearing layer. The reform's structural effect was enormous: it created a permanent, compounding pool of domestic institutional capital that now anchors demand for TASE-listed equities and Tel Bond corporate debt. The pension reform is why Israel's institutional savings-to-GDP ratio is among the highest in the OECD.