In the first half of 2021, the Palestinian Authority (PA) did not receive any donor aid funds, according to the budget performance report it publishes monthly. Recent reports indicate that EU funding to the PA has merely been delayed for “technical reasons.” The delay processing the EU aid has compounded the alleged financial difficulties of the PA resulting from the major drop in all international aid.

Before the EU manages to overcome its technical difficulties and other countries consider restoring aid to the PA, Palestinian Media Watch (PMW) suggests that the donors first demand that the PA explains why it is funding the Palestine Liberation Organization (PLO) and what exactly the PLO has done with over 415 million shekels it received from the PA since the beginning of 2021. Over the years, cumulatively, the PA expenditure on PLO institutions has totaled nearly 8 billion shekels.

Every month, the PA transfers huge sums of money to “PLO institutions.” The sum transferred depends on whether the PA is open and honest about its payments to the terrorist prisoners or whether it is trying to hide them. As PMW has already proven, when the PA is open and honest about its monthly salary payments to the terrorist prisoners, the PA’s monthly budget performance includes a provision for the Ministry of Prisoners’ Affairs (or some similar name).

When the PA is trying to hide its payments to the terrorist prisoners, it funnels the money through the budgetary provision for the “PLO institutions.” While PMW has written extensively on this PA deceit, the following table sums up the story:

	PLO Institutions	Ministry of Prisoners
June 2021	415,017,000	(-)
June 2020	390,915,000	(-)
June 2019	177,170,000	322,985,000
June 2018	193,581,000	266,890,000
June 2017	464,379,000	(-)
June 2016	430,570,000	(-)

In 2016 and 2017, the PA was trying to hide its payments to the terrorist prisoners. In those years, the PA, according to its own financial reports, had no expenditure for the terrorist prisoners. In each of those years, the PA expenditure on the “PLO institutions” stood at 430 million and 464 million shekels, respectively, for the first half of the year.

In 2018 and 2019, when the PA openly showed its expenditure on the terrorist prisoners, the expenditure for the Ministry of Prisoners’ Affairs suddenly jumped to 266 million and 322 million shekels, respectively, during the first six months of the year, while the expenditure on the PLO institutions plummeted to 193 million and 177 million shekels, respectively.

In 2020 and 2021, when the PA returned to its policy of trying to hide the financial expenditure for the salaries of the terrorists, it completely removed the line of the “Ministry/Commission of Prisoners’ Affairs” from its budget performance. Accordingly, while the PA expenditure on the monthly salaries of the terrorist prisoners ostensibly disappeared, the PA expenditure on the “PLO institutions” again spiked, rising to 390 million and 415 million shekels, respectively, for the January through June period.

Against the backdrop of its current alleged financial crisis, PA Chairman Mahmoud Abbas headed a meeting of his Fatah faction’s central committee. Instead of recognizing that the PA’s terrorist reward program not only costs the PA hundreds of millions of shekels/dollars/Euros a month, but that as a direct result of the pugnacious policy international aid to the PA has dropped, Abbas and his central committee decided to dig in their heels, once again committing themselves to continue the policy, come what may:

“The central committee again expressed its condemnation and rejection of the Israeli government’s deduction of the Martyrs and prisoners’ salaries from the Palestinian tax money, which is something that the Palestinian people will not accept. It emphasized that under no circumstances can the salaries of the families of the Martyrs and the prisoners be harmed, and that this Israeli decision contradicts all the signed agreements, which determine that the Palestinian tax money is the Palestinian people’s right and not charity from anyone.

The central committee reviewed the [PA] government’s great financial distress, which stems to a large extent from the financial blockade to which the PA is being subjected. It called on the Arab brothers and the friends [of the PA] to hurry to grant aid in order to get out of this crisis.”

— Official PA daily Al-Hayat Al-Jadida, Aug. 25, 2021 [emphasis added]

The reference to the Israeli deduction refers to the implementation of Israeli legislation. As part of the Oslo Accords, Israel agreed to waive certain tax incomes in favor of the PA. Instead of using the Israeli money to fight terror, the PA was using the money to pay its financial rewards to terrorists. As PMW proved, Israel was, in effect, financing and rewarding Palestinian terror against Israel and Israelis.

To combat this situation, in 2018, PMW actively worked with the Israeli parliamentary Foreign Affairs and Defense Committee — leading to the passage of legislation in Israel’s parliament. The law instructs the state to deduct and freeze the amount of money the PA pays in salaries to imprisoned terrorists and families of “Martyrs” from the tax money Israel collects for the PA. As a result of the implementation of the law, Israel has already withheld over one billion shekels. The law further provides that should the PA stop the terror payments for a full year, the Israeli government would have the option of giving all or part of the frozen money to the PA.

Aside from the PA’s feeble attempts to hide its monthly terrorist salary payments, PMW has also proven that some of the money the PA transfers to the PLO even finds its way to the Popular Front for the Liberation of Palestine (PFLP) and the Al-Aqsa Martyrs’ Brigades, both designated by the US and EU as terror organizations.

According to a statement of EU representatives, the EU provides the PA with aid in the amount of “300 million euros, equal to $400 million, per year. Of it, $150 million is being allocated to the PA to cover current expenses, such as employees’ salaries and operating expenses…” [official PA daily Al-Hayat Al-Jadida, Aug. 19, 2021]. The representative continued, saying that the aid “was stopped last month [July 2021] because the EU is approving its budget for the new year, and that it is anticipated to renew its aid in October [2021],” according to the same article.

If the PA budgetary expenses on the PLO institutions continue for the rest of the year as they were during the first half of the year, the total 2021 PA expenditure on the “PLO institutions” is set to reach 830 million shekels or €218,674,851.

In other words, practically, the EU’s entire aid of $150 million donation to the PA, is simply being used to fund the “PLO institutions,” including funding EU designated terror organizations and the payment of the PA’s monthly terror salaries.

Unless the EU is content with its aid to the PA being used to promote, incite, and reward terrorism and terrorists — and unless the EU is content funding, directly or indirectly, EU designated terror organizations — the EU should first demand that the PA cease funding the “PLO institutions” before renewing its aid.

The PA, and only the PA, is responsible for its financial distress. The PA payment of the terror rewards has made the US, Canada, Australia, and the Netherlands cut financial aid to the Authority, while other countries have limited their aid to certain PA projects. If the PA were to abandon its terror rewarding policy, the decision would not only relieve the PA’s financial crisis, but it would also open a door to other changes in PA priorities and values, which are all prerequisites for peace.

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