Since 2014, the Ministry of Finance of the Palestinian Authority has published an annual expected budget in the first part of the year and monthly reports on actual expenditure in each budget line, writes Palestinian Media Watch (PMW). Based on the PA’s 2018 monthly reports, the PMW has been able to document that the PA spent at least 502 million shekels on salaries and other benefits for terrorist prisoners and released prisoners in 2018.
Shortly afterwards, the Israeli government announced that in order not to fund PA terrorist aid, it would deduct 502 million shekels from tax transfers to the PA, divided into 12 monthly deductions of 42 million shekels.
After understanding that the financial transparency was used by the PMW, and then the Israeli government to see the exact amount that the PA used to reward terrorist prisoners, the PA decided to hide the numbers from the international community. Instead of the financial reports, the Ministry of PA has been writing the following on the website for more than two months:
“Due to emergency legislation and legal dependencies on the Israeli side, the financial reports have been temporarily suspended.”
Donor countries that donate to the PA have demanded full financial transparency as a condition of providing their financial support to the PA. The PA is currently suffering from a self-inflicted financial crisis after refusing to accept hundreds of millions of dollars a month that Israel has sent to them. Instead, the PA has turned to the international community for more financial support.
If the PA published their current monthly budget report, the international community would be appalled. They would see that PA spending in all budget categories was cut significantly in 2019, except for payments of salaries to terrorists and payments to so-called “Martyr” families, with payments at the same level or higher compared to last year. Last year, the two budget lines, which include financial support for terrorists, accounted for 7% of the PA’s budget. This year, the PA has refused to accept the tax revenue – which accounts for 50% of the PA’s budget, therefore the actual cost of terrorist support accounts for a much larger percentage of the PA’s spending – possibly 15%.
Would international donors donate money to the PA if they knew that such a high percentage of PA spending goes to terrorism? Perhaps this is another reason why the PA has given up transparency and is hiding its finances.
MIFF has written several articles about PA that you can read here.