Examination of Witnesses (Questions 260-279)
RT HON
HILARY BENN
MP, MR MARTIN
DINHAM, MR
DAVID HALLAM
AND MR
PETER GOODERHAM
14 DECEMBER 2006
Q260 Chairman: Good afternoon, Secretary
of State. Thank you very much for coming in to give evidence to
us in what is the last formal evidence session on our report into
aid and development in the Occupied Palestinian Territories. I
wonder first if you could introduce your team. As I think you
were just literally back yesterday from the Occupied Territories
of Gaza and the West Bank, you might wish to give us a minute
or two on your view about that.
Hilary Benn: I
think this is a reprise for Members of the Committee. I have on
my right Martin Dinham, who is the Director, Europe, Middle East
and the Americas. On my left is Peter Gooderham, who is the Director,
Middle East and North Africa in the FCO, and David Hallam, who
heads the Palestinian Programme in DFID. Perhaps I can say very
briefly what I did, if that would be helpful. I went to Gaza on
Monday having visited Sderot, which is an Israeli town on the
border that has been attacked quite a lot over the last six years.
I went to the Shifa Hospital; then to the Karni Crossing, and
to Beit Hanoun to visit the house where the shell came through
and killed 19 people. We spent the afternoon in Hebron with members
of the Hebron Rehabilitation Committee, walking round the old
city and seeing the extraordinary impact which the settlers have
had there. I met General Dayton, spoke to OCHA and then we went
to visit the Qalandia refugee camp. We announced, as you probably
will have seen, a four year agreement with UNRWA[1]
providing about £75 million.[2]
It is a long-term commitment. It is about half of our programme,
as you will be aware, in the Occupied Territories that goes to
support UNRWA. I met President Abbas. I had a meeting with Hanan
Ashwari and met civil society representatives, the Palestinian
private sector and then yesterday I had a meeting with Israeli
Foreign Minister Livni, Deputy Defence Minister Sneh, Shimon Peres.
So we packed it in over three days. Things are pretty grim, if
I can be frank. We all feel a terrible frustration. I would much
rather that we were doing a proper development programme. The
reason we are not doing a proper development programme is because
the politics are grim and everything that we discussed, everything
I saw, the movement restrictions, the closures, the collapse of
the economy, the fear that people feel because of what is going
on, comes down to a failure of the political process. The question
that I think suffuses all of our minds from reading the transcripts
of the previous evidence sessions—and I know it fills all
of your minds—is we look at all of the different consequences
of what has been going on but until the political process moves
nothing is really going to change.
Q261 Chairman: Thank you. You had a little
more success with the security situation than we did in as much
as we were unable to go to Gaza or to Hebron. We were en route
to Hebron and diverted which, from our point of view, was unfortunate.
Much of the other parts of your programme we have probably followed
in the same footsteps and have seen the same sorts of things.
You mentioned the announcement about the money for UNRWA over
four years. How much of that is additional money from what would
normally have been given to UNRWA? I am not sure you have said
it in the release but the withholding of budget support was not
significant because the EU has contributed a greater amount in
humanitarian assistance. The fact is money has been withheld by
both the EU and the Member States and has then been given by a
different route. Are you able to tell us how much of the money
has been withheld, both by the UK, by the Commission and by the
European Union as a whole—that is, the Member States? Do
you have an indication of that? If I put it in these terms, the
statements that come out tend to be, "We, the EU, individually
and collectively, are giving this extra resource to the situation
in Palestine which shows our commitment" but it does not
always explain that they have also withheld quite a lot of money
that previously had gone there because of the political situation.
I think it is important that we know what has been withheld as
well as what has been given.
Hilary Benn: On UNRWA, in effect
it represents an increase of about £17 million. It is a longer
term commitment. Karen Abuzayd, who heads UNRWA, warmly welcomed
it, not surprisingly. Having long-term funding enables her to
plan. UNRWA does a very effective job in extremely difficult circumstances
and I want to take this occasion to pay tribute. Secondly, the
total amount of European Union assistance—that is, European
Community and the European Union and Member States—to the
Palestinians has increased by 27% this year to a total of £442
million. The UK's bilateral aid is the same as it was last year,
although it is being given in a different form and no doubt we
will come to that. I know there is a perception in some quarters—and
I encountered it during my visit—that somehow we were doing
less. People talk about punishment of the Palestinians. I think
genuinely it would be rather hard to describe an increase in assistance
as being a reduction because self-evidently it is not. Because
of the circumstances surrounding the election of the Hamas-led
government earlier this year, we had to give that assistance in
a different way as opposed to what we were doing before and obviously
the Temporary International Mechanism has been the focus of that
bit that we were previously giving to the PA.
Q262 Chairman: You are not able to
give us today the figures for what was actually withheld which
had previously been given? On budget support, for example, we
heard that the European Commission gave €70 million, which
is about £42 million, in 2005. The UK gave £17.2 million
over 2004 and 2005. Norway, of course not an EU state, gave £56
million. The implication is that all of this money was withheld
as a result of the election of Hamas and that has to be offset
against additional resources.
Hilary Benn: That is not the case,
certainly as I understand it. David Hallam will point that out.
There was a point towards the end of last year where we did temporarily
withhold some money because the PA was not meeting all of the
benchmarks that had been set out for the form of support that
we were giving; but in the period immediately prior to the Hamas
government taking office we then released that money that we had
been withholding because frankly the circumstances had changed
completely.
Mr Hallam: In terms of withholding
money, we had a two year agreement with the PA to provide a certain
amount of budgetary support to them and that agreement was fulfilled
and all the money was disbursed. Of course in an ideal world we
would have then negotiated a new budgetary support agreement with
the next Palestinian Authority but we were unable to do that.
It is a slightly semantic point but the case is not that we have
pulled money out or held it back. We disbursed all we said we
were going to disburse and then we were unable to negotiate a
new agreement with them. In terms of comparing figures, the overall
amount of European Union—that is, Member States and the
money that we put through the Commission—that went into
the budgetary support trust fund last year, actual disbursements,
were $80.2 million. That is about €65 million, say, but if
you compare that to the kind of assistance that is being provided
this year through the Temporary International Mechanism, which
provided funding for many of the things that would have been provided
by budgetary support like front line supplies for services, like
allowances for individuals which is cash in their pockets, the
total amount there is €201 million. There is a substantial
increase in the amount of European, including British, support
for this kind of basic need.
Chairman: I did have a note from our
adviser saying it would be helpful to have what information you
have now rather than anything in writing because we are up against
the timetable.
Q263 Mr Davies: What was the total
value of our contributions to UNRWA in the previous four years
ending with this year?
Mr Hallam: I am afraid I do not
have the exact figure for all four years but previously we had
been providing an average of around £15 million a year. That
is how much we have provided this year and that is how much we
provided last year.[3]
Q264 Mr Davies: So probably £60
million?
Mr Hallam: Yes.
Q265 Chairman: Secretary of State,
you said it was about £17 million.
Hilary Benn: It is about £17
million more so that just about squares.
Q266 Mr Davies: So that will be £76
million instead of £68 million. You are saying over the next
four years it is going to be £76 million so that is an increase
from £68 million to £76 million, eight million pounds,
but probably in real terms taking account of inflation that is
roughly the same level of support going forward over the next
four years as you have been providing over the last four years.
Is that right?
Hilary Benn: It is an increase.
It depends what inflation rate we take.
Q267 Mr Davies: Roughly in real terms,
it is very comparable.
Hilary Benn: I think I would say
it is more than inflation.
Mr Dinham: It is £60 million
compared with £76.6 million.
Q268 Mr Davies: The reason I ask
is that, after the press statement where it says, "This is
why I am announcing today a package of funding to help Palestinian
refugees over the next four years worth £76 million",
it is important for people to understand the thrust and the effect
of that statement and to know what we have been providing up to
now. We have been providing money for UNRWA since 1948 or 1949,
so this is really a continuum rather than a dramatic, new announcement,
is it not?
Hilary Benn: I do not think I
used those last words in what I said I was announcing. It is a
factual statement. One, this is a four year deal which is very
important to UNRWA to enable it to plan ahead. Secondly, it is
an increase compared with what we have been doing in the previous
four years and it should be read and seen in those terms and in
no other.
Q269 Mr Davies: It should be seen
in those terms?
Hilary Benn: I hope that is what
the press release you have in front of you does.
Chairman: It is fair to say that some
of the NGOs have expressed some dissatisfaction. They felt this
press release was designed to give the impression of a radical
new initiative rather than a continuation of funding.
Q270 Mr Davies: I think you should
read it again, Secretary of State. It is spin-doctor speak really.
Read in isolation, it is designed to give the impression that
something very new has happened. Actually, nothing new has happened
at all which we have just established. You say here, "Refugees
make up 44% of the total Palestinian population in the Occupied
Palestinian Territories ..." et cetera. I think it
is true that most of our fellow citizens reading that would assume
that the 44% of the total Palestinian population which are described
as refugees are in some way particular sufferers from the present
crisis: that the distinction between refugees and non-refugees
is a distinction between those who have suffered most in recent
circumstances and those who have suffered least. In fact, as you
know but of course most people do not I think appreciate, the
distinction is an historic one. The difference between refugees
and therefore people entitled to benefit from the UNRWA programmes
and those who are not refugees is a distinction between those
who were refugees in 1948 and their descendants, sometimes the
third and fourth generation, and the rest of the Palestinian people.
That is correct, is it not?
Hilary Benn: That is true. That
is indeed the historical situation, yes.
Q271 Mr Davies: I put it to you that
after all this time, after 60 years, this is a very artificial
distinction to sustain. Only a very small minority of the beneficiaries
of UNRWA left what is now the state of Israel in 1948. The great
majority are their children, their grandchildren, their great-grandchildren
and, in some cases, their great-, great- grandchildren—it
is a little bit like distinguishing here in the United Kingdom
between people perhaps whose ancestors came from Scotland or Ireland
50, 60, 70 or 80 years ago. It is a very funny way of categorising
a population. It is also true that in certain ways—and we
saw that ourselves when we were in Palestine—those who are
classified as refugees are more privileged than their fellow Palestinian
citizens at the present time. They have access to UNRWA clinics
and schools—we visited some—and those are carrying
on as before. The UNRWA teachers, health workers or doctors are
still being paid. Those who are not lucky enough to be categorised
as refugees and cannot get into the UNRWA clinics or schools have
to go to the existing Palestinian state schools or hospitals and
those have suffered from the fact that the doctors, nurses, health
workers and teachers are not being paid and, in some cases, were
on strike when we were there a few weeks ago. I put it to you
that after 60 years it is a totally artificial distinction to
maintain between different parts of the Palestinian population.
It is absurd that those schools and clinics should not be available
to anybody who needs them. It would be a very good thing if we
now looked again at this distinction which you continue to make
so forcefully in your present press release.
Hilary Benn: The first point and
the important one is that `refugee' is a political designation:
refugee. People would hear the word "refugee"—I
take the point that you make—and they would think about
camps. Of course, you go to Jenin, as I did the last time that
I was in the West Bank three and a half years ago, or you go to
the community of Qalandia, because that is where I visited on
Tuesday morning, and you find buildings where people live. I have
seen one of those clinics and I take your point about that but
it is a political distinction which the refugees who classify
themselves as such hold to very dearly because it is an expression
of the failure to resolve the political problem. They are the
ones who cling to it, but I take the broader point you make. Another
way of looking at it is the difficulty in that sense of distinguishing
one from the other. Secondly, I did ask a specific question about
access to the clinic because it was functioning. There were mums
with babies waiting to get vaccinated, to get family planning
advice and so on. They said that if other people came who were
non-refugee cardholders and they needed treatment they would not
refuse them access. It obviously depends whether you have an UNRWA
clinic near to you. There are circumstances in which UNRWA facilities
will be made available to those who are not classified as refugees.
Q272 Joan Ruddock: My question is
about the finance and it has been well overtaken now by what has
been said but David Hallam spoke as though by increasing aid monies
somehow the problems were being dealt with. There was not a withdrawal
of funds. Could we know what was the annual value of the UK contribution
in budget support? I think there would have been an expectation
that that money would have continued once the problems had been
sorted out. There would have been a presumption that that level
of budget support would have been given and if it clearly was
not given that makes for a deficit. Is it not true that there
is an even greater deficit and that is because Israel is not providing
to the Palestinian Authority the clearance revenues? Even though
more aid is rightly being given and there is money in pockets,
that money in pockets is considerably less than people would have
had if they were receiving their regular salaries through the
normal channels.
Hilary Benn: I do accept that
point. It may be helpful if we provide you with a note that gives
you those figures that you have been asking for. You are absolutely
right. The big hole is the revenues that are being withheld. That
is $65 million a month. That is much bigger. The point we were
making was that the argument that the international community
has "punished" the Palestinian people by reducing support
this year is not borne out by the facts. On the contrary, I gave
the figures right at the beginning for total European Union assistance,
both the EC and the EU. The withholding of clearance revenues
has left a very big hole. I raised the issue with Foreign Minister
Livni yesterday and said to her, "Could you please consider
putting that money through the Temporary International Mechanism
(TIM)?" because (a) it is money that is owed to the Palestinian
people—it is their revenue, and (b) it would help to deal
with the real problems that there are on the ground. Two doctors
who kindly greeted us at the Shifa Hospital said, "We have
had about 30% of our salaries". They are all at work and
I welcome the fact that the strike that was affecting the health
service in the West Bank, which Mr Davies referred to a moment
ago, has now been brought to an end. The Shifa Hospital was certainly
functioning. I visited the intensive care unit and the dialysis
ward. They have problems with supplies and equipment. The World
Bank window which is Window I is going to be providing more funding
for drugs and so on, but if you could make a breakthrough on the
revenues this would help to transform the position as far as payment
of salaries and other payments is concerned. That is where we
need progress.
Q273 Joan Ruddock: I thought maybe
Mr Hallam was going to answer the point about what was the value
of the annual revenues that were direct budget support.
Mr Hallam: The total amount of
budget support that we provided in 2004-05 and 2005-06 was £16
million.[4]
Q274 Chairman: I am reminded that the
World Bank told us that the $65 million a month which the Government
of Israel withheld was that revenue and the total budget support
was $40 million a month, which means therefore that the Palestinian
Authority has effectively lost $105 million a month which puts
into perspective the TIM and additional aid which does not go
anywhere near replacing that lost revenue. You quoted the point
about not wishing to punish ordinary Palestinians but if you are
an ordinary Palestinian and you are a teacher or a doctor who
is not being paid, or you are a patient or a pupil who is not
being taught or cared for, I think you feel you are being punished,
do you not?
Hilary Benn: I accept that people
look at their lives, at the fact that they are not getting paid
their full salaries, that the economy has declined. It looks as
if GDP is going to reduce by about nine per cent this year. The
figures are in the process of being revised. You cannot move about.
You are not sure whether your goods are able to get sold. You
are not sure if you can get to work or visit your mum or your
grandma. As I said at the beginning, life is pretty grim. I accept
that entirely. You may want to come on now to the nature of the
decision that we and others in the international community took
following the election of the Hamas-led government. I think it
was the right thing to do in the circumstances. What we then tried
to do was to find another way of giving the money that we had
been giving, in part in the form of budget support as we have
just been discussing, through the TIM. The total amount has gone
up but that does not really deal with the fundamental problem
of the much bigger sum of money, as we just identified, that is
being withheld by Israel. When you put in those two sets of circumstances—the
election of the Hamas government and the withdrawal of the revenues,
the closures and the collapse of the economy—it is really
difficult for people.
Q275 Chairman: We were told by people
that they had participated in the democratic process. It was true,
I understand, that the Government of Israel had indicated in advance
of the election that if Hamas were to win they would withhold
the money. It is not at all clear that the international community
had given the same signal. People have said to us that they felt
they had been encouraged to participate in the democratic process.
Hamas was allowed to contest the elections and duly won them.
The Palestinian people found that their services collapsed as
a result of action taken by the international community. Is not
the reality, which was not put to the Palestinian people, "If
you elect Hamas you are not going to get support"? Do you
not think they should have been told that in advance?
Hilary Benn: No, I do not, because
I think we would have been rightly and profoundly criticised if
we had said that. People would have felt we were trying to constrain
the choices that they make. To go to the heart of the issue, I
think everybody recognises the only way this problem is going
to be solved is by process of negotiation. I know of no other
means by which it is going to be brought to an end. The Hamas-led
government—let us be frank—did not probably expect
to win, I think, but certain responsibilities come with being
in government as opposed to be a party seeking to form a government.
If they do not recognise the right to exist of a partner with
whom you have to negotiate if you are going to solve the problem
and they have not renounced violence, though I take your point
about the ceasefire, and they are not prepared to pick up the
previous commitments as far as negotiations are concerned, you
have a rather fundamental problem. In the circumstances, the international
community through the Quartet said, "There are three basic
principles. If you sign up and support those, then fine. If you
do not, I am afraid we cannot deal directly with you but we will
find another way of trying to continue to provide support to the
Palestinian people." That is what the TIM is about. That
is the decision that we took. We would have been very roundly
criticised, I think, from other quarters if we had not done it.
I come back to the central point: if you are not prepared to negotiate
with the only people with whom you can find a solution to this,
this is not going to solve the problem, is it? That is my firmly
held view, so I answer my own question.
Q276 Richard Burden: Whoever was
surprised or not by Hamas's victory, I think anybody who had been
in the area in the months leading up to the elections would have
known it was a possibility. Presumably the British Government
knew it was a possibility. Did the British Government know before
the elections that, if Hamas won the elections, the aid and contacts
with the PA would be cut off, even if they did not say it, or
was that decision made after the election?
Hilary Benn: The decision was
made after the election because you have to deal with the circumstances
as they are. Yes, you are right. We know that Fatah was not terribly
popular. We know there was a concern about corruption. We know
that Hamas had been providing a lot of services. I heard that
for myself when I visited Gaza in 2003. That was already the case
at the time. The decision was taken after the election because
there was a new set of circumstances and we had to decide what
we were going to do.
Q277 Richard Burden: As far as I
understand, the background was that Hamas had been on a ceasefire
for months. In the election they stood for the first time in a
democratic election on a platform that did not say anything about
destroying the state of Israel and they were elected. What was
it they did in that election or afterwards that made the international
community then decide that it was going to cut off aid when it
had not decided that previously? What had they done, apart from
get elected?
Hilary Benn: They formed the government
and obviously that was a changed set of circumstances. They have
not indicated their willingness to sign up to the Quartet principles.
In the end, the international community made a judgment that if
there is going to be the prospect of peace in the Middle East
you have to sign up to those principles. That is not where Hamas
did. If you ask me: do I hope that Hamas will in time make the
journey that the PLO made over a period of, what, 30 years from
the position that it did occupy to being prepared to negotiate
with Israel on the two state solution, I hope that will be the
case. I do not see the signs that that process has really begun.
I think it is not unreasonable to say there are three really quite
basic principles if the problem is going to be resolved. If you
can express support for those, then there is a chance of doing
business. If you do not, there is a problem.
Q278 Richard Burden: Why did we not
put those principles on Israel at the start of the Oslo process
because, at the start of the Oslo process, Israel did not recognise
the right to a Palestinian state and it had not renounced violence.
The Palestinians had but Israel had not. We did not put those
three conditions on them. Why did we apply them to one side and
not the other?
Hilary Benn: If you are talking
about development assistance which is the responsibility I have,
obviously we are not giving development assistance to Israel so,
as far as the decisions that I have to take in relation to development
assistance, we have been providing support to one party and not
to another. Israel does now accept that there needs to be a Palestinian
state. The negotiations have not worked to the point to bring
that about. Oslo is some years ago. I think we have to deal with
the circumstances as they are. They are as I have tried to describe
and that was the basis on which we took the decision.
Richard Burden: Was there ever any decision
made before Hamas was elected to the national government? It had
already taken control of a number of local councils, municipal
authorities. The international community and the British Government
was prepared at that stage to have contacts with Hamas elected
officials as elected officials but did not have contact with them
as Hamas representatives. Why would that have not worked?
Q279 Chairman: You do have some colleagues
from the Foreign Office here so it is not an international development
issue.
Mr Gooderham: You are right. We
did have some very limited contacts with Hamas last year but we
have not had any since.
1 United Nations Relief and Works Agency for Palestine
Refugees in the Near East. Back
2
DFID Press Release, International Development Secretary, Hilary
Benn, announces £76.6 million for Palestinian Refugees,
12 December 2006. Back
3
Note by witness: DFID's contributions to UNRWA's General
Fund and development projects amounted to £56.3 million over
the past four years. The new four-year agreement to provide up
to £76.6 million to UNRWA's General Fund therefore represents
an increase of over £20 million on past core funding. These
figures do not include ad hoc responses to UNRWA's emergency
appeals, which have varied from zero to almost £9 million
in recent years, as any future contributions to emergency appeals
are impossible to predict. As well as increased funding, the new
arrangement provides UNRWA with predictability of donations and
the flexibility to allocate funds to its own priorities. UNRWA
has welcomed DFID's new commitment and has commended this approach
to other donors. Back
4
Note by witness: Actual figure is £17 million over
two financial years, 2004-05 and 2005-06. Back
| 
