On 17 February 2019, the Government of Israel decided unilaterally to withhold the equivalent of 123 million euro in Palestinian tax revenue transfers. This decision is a result of legislation adopted by the Knesset last year that instructs the Government to withhold money equivalent to what the Palestinian Authority pays to Palestinians convicted by Israeli courts of involvement in terrorism or other security-related offences, and to their families.
I also understand that the Palestinian leadership has in response decided to reject all clearance revenue in protest at the funding cut, which no doubt will have repercussions for the Palestinian people who depend on the PA to deliver basic services such as healthcare and access to education.
I am acutely concerned about the worsening financial situation of the PA. Thankfully the impact of its budget shortfall last year was somewhat mitigated by donor aid. This economic insecurity is expected to increase this year, and as we have seen in 2018, the same scale of financial aid by large donors is by no means guaranteed. The financial stability of the PA is inextricably linked to the security of both the Palestinians and the Israelis. I believe that the EU is right to urge the Palestinian Authority to review how it operates its system of payments. However, as I have said before in this House and elsewhere, unilateral moves, such as withholding a huge proportion of the revenue collected on the Palestinian Authority's behalf, seriously undermine the chances for a just and lasting peace.
These are very serious developments that put at risk the financial stability of the Palestinian Authority and ultimately the security of both Israelis and Palestinians alike. EU Heads of Mission in Ramallah, including the Irish representative to the Palestinian Authority, met with senior figures from the Palestinian Authority to discuss this decision.
I reiterate the EU’s call for Israel to honour its obligations under the Oslo Accords, with due regard to the Paris Economic Protocol, which administers the economic and financial relations between Israel and the PA.
I can assure the Deputy that these concerns about the repercussions of this move on the peace process will be raised with Israeli interlocutors.