Government response
Introduction
The UK Government welcomes this opportunity to respond
to the International Development Committee's report on the UK's
development work in the Occupied Palestinian Territories (OPTs).
We acknowledge that the prospects for peace between Israelis and
Palestinians might appear difficult, but we welcome the Committee's
conclusion that the UK should continue to support peace talks,
keep hopes of the two state solution alive and provide funding
to support the Palestinian people and development of a Palestinian
State.
Resolving the Israeli-Palestinian conflict remains
a foreign policy priority for the UK. Our position is clear: we
want to see a negotiated settlement leading to a safe and secure
Israel living alongside a viable and sovereign Palestinian state;
based on 1967 borders with agreed land swaps, Jerusalem as the
shared capital of both states, and a just, fair and agreed settlement
for refugees. The events in Gaza this summer have only confirmed
the urgent need to reach a peaceful solution for both Israel and
Palestinians.
The political horizon remains uncertain. The situation
on the ground, however, is deteriorating.
According to the IMF, the Palestinian economy has
been slowing in recent years, especially in Gaza. Growth in the
OPTs decelerated from 6.3% in 2012 to 1.9% in 2013 and continued
to decline in the first quarter of 2014.[1]
Israeli movement and access restrictions are the main impediment
to economic growth. In addition, the latest escalation of violence
means that real GDP in Gaza is expected to contract by 15% in
2014 and economic growth in the OPTs as a whole will decline by
4%.[2]
Without economic growth, unemployment will rise further. Even
before the latest violence, over a quarter of Palestinians were
unemployed (18% West Bank, 41% Gaza).[3]
Rates for young people, women and refugees are even higher.
The situation in Area C remains fragile. We are gravely
concerned by the continuing demolitions of Palestinian properties:
between January and September 2014, a total of 399 Palestinian
owned structures have been demolished in all of the West Bank,
including East Jerusalem, resulting in the displacement of 823
people. Plans to move Bedouin communities from the land east of
Jerusalem to a township near Jericho could, according to the UN,
amount to forcible transfer. Combined with the increase in Israeli
settlement building - amounting to an increase of 123% in building
starts in the West Bank in 2013[4]
- and continued difficulties in obtaining planning permission
for Palestinian development, the viability of Palestinian life
and livelihoods in Area C is increasingly precarious.
The events in Gaza this summer came on top of an
already chronic situation: 57% of the population were food insecure,
80% were reliant on aid and only a quarter of households received
running water on a daily basis.[5]
The humanitarian impact of the conflict was severe: there were
more than 2,100 Palestinian fatalities, more than a quarter of
the population were internally displaced, and the damage to key
infrastructure including water and power has been substantial.
In response to the unprecedented needs, the UK has been one of
the biggest donors, providing more than £17million in emergency
assistance. This support is saving lives, but a political solution
is needed to break the cycle of violence. It is vital that the
parties engage in negotiations to reach a sustainable and durable
agreement which addresses the underlying causes of the conflict.
For children aged six or over living in Gaza, the conflict this
summer was the third they have experienced in their short lives
- this must not happen again.
In this context of political stasis combined with
growing human suffering, the Committee's endorsement of the UK's
commitment to build the institutions of a future Palestinian state,
to support economic growth, and to provide assistance to the most
vulnerable is welcome. It is easy to understand why, in some cases,
the Committee would like to see the UK do even more to improve
the lives of Palestinians, but tough choices need to be made.
Aid is not the solution in the OPTs. We know that political will
is required to unlock what by now are very familiar problems.
Ultimately, it is the leaders of the parties involved who must
find the political will to take the bold steps necessary for peace.
The UK and other members of the international community stand
ready to support the parties to move forward in the weeks and
months ahead.
DFID Response to the Conclusions
and Recommendations
The OPTs: the background
Recommendation 1: We regret
the recent suspension of peace talks between the Government of
Israel and the Palestinian Authority. We note with sadness the
terrible crimes recently committed by both Palestinian and Israeli
extremists. We understand the revulsion which many Israelis feel
for Hamas, whose charter calls for the destruction of the Israeli
state. We condemn the continuous rocket attacks on Israel from
the Hamas-controlled Gaza Strip, which show the seriousness of
Israel's security concerns. Nevertheless, in the long run there
has to be agreement between Fatah and Hamas which should result
in peace talks between such a unified Palestinian government and
Israel. All parties to these peace talks, including Hamas, must
accept the Quartet's principles if there is to be a two-state
solution. Moreover, we believe that the reconciliation increases
the likelihood that Hamas will one day accept Israel's right to
exist. US Secretary of State John Kerry had shown extraordinary
leadership in bringing the parties to the table, and despite the
murders of late June and July we remain hopeful that the current
suspension will be temporary rather than permanent. (Paragraph
17)
Agree.
The UK Government remains fully committed to supporting
efforts for peace. We have been deeply saddened by the violence
in the region this summer. These events reinforce the need for
progress towards lasting peace. We continue to believe that only
a negotiated two-state solution will resolve the Israeli-Palestinian
conflict once and for all. The UK stands ready to do all it can
to support this goal.
For this to happen, it will be necessary to end the
separation between Gaza and the West Bank and reunite them under
a Palestinian Authority fully committed to peace with Israel.
We have made it consistently clear that we will engage any Palestinian
government that shows through both their words and actions that
they are committed the principles set out by President Abbas in
Cairo in May 2011. This means that the Palestinian Authority must
continue to uphold the principle of non-violence, and remain committed
to a negotiated peaceful settlement of the Israeli-Palestinian
conflict, accepting previous agreements and obligations, including
Israel's legitimate right to exist. The UK's ongoing engagement
with a new Palestinian government - including through the provision
of direct financial support - will be based on its adherence to
these principles and commitments.
In the days ahead, the PA, under the political leadership
of President Abbas, must show the necessary leadership and vision
to recommit itself to dialogue with Israel and make progress on
governance and security for Palestinians across the whole of the
OPTs.
Hamas faces a fundamental decision about whether
it is prepared to accept the Quartet principles and join efforts
for peace, or whether it will continue to use violence and terror
with all the associated consequences for the people of Gaza.
Israel will need to commit to a return to dialogue
and to avoid all actions which undermine the prospects for peace,
including settlement activity which does so much to undermine
confidence in negotiations.
Recommendation 2: The
suspension of the peace process should not lead to the suspension
of discussions to lift restrictions on economic development in
the OPTs. These cannot await a peace agreement; there has not
been a final peace settlement in over 40 years and there may not
be one for many years. The stalling of the peace process should
not prevent the UK from encouraging economic development in the
OPTs and encouraging the removal of those restrictions which are
not justified on security grounds. Indeed, we see it as in everyone's
interest to increase prosperity in the OPTs. (Paragraph 18)
Agree.
We remain deeply concerned about Israeli restrictions
on the movement of people and goods in the OPTs. These restrictions
do tremendous damage to the Palestinian economy and are the main
impediment to sustainable economic growth. In close coordination
with the Quartet and EU partners, we continue to lobby the appropriate
Israeli authorities on the issue of improving movement and access.
Helping to build Palestinian institutions, promoting
economic growth and supporting the most vulnerable will remain
important objectives regardless of progress or otherwise in the
peace talks. Economic progress can never be a substitute for a
political settlement, but it is vital that Palestinians see tangible
improvements in their daily lives.
In addition, we agree with the Committee that increased
prosperity in the OPTs is firmly in Israel's long-term interests.
Economic development in the OPTs
Recommendations 3 & 4: If
the OPTs are to enjoy a better future, promoting economic development
will be of the utmost importance. We strongly support DFID's recently-launched
Palestinian Market Development Programme (PMDP), but we also believe
that it could do more in this area.
We recommend that DFID launch a Private Sector
Grant Facility (PSGF) and Development Impact Bonds (DIBs) in the
OPTs, as the Portland Trust recommended.
(Paragraph 22)
Partially agree.
We agree with the conclusion that economic growth
is vital for Palestinian development, and we welcome the Committee's
support for the Palestinian Market Development Programme (PMDP).
This programme is helping to make Palestinian businesses more
competitive: over the next five years, it will enable 570 companies
to develop new products and enter new markets. Additional funding
announced by the Prime Minister during his visit to Israel and
the OPTs in March 2014 will also help to create a Delivery Unit
in the PA Deputy Prime Minister's office to deliver a plan for
reconstruction in Gaza alongside a broader plan for rapid, sustained
and equitable growth in the West Bank and Gaza Strip.
DFID has been discussing the Private Sector Grant
Facility with the Portland Trust for some time. We have not yet
been convinced that the concept is developmentally sound. Although
large infrastructure projects can create jobs and provide a boost
to the economy, providing direct subsidies to reduce the costs
to large investors is not necessarily the best approach for donors
to adopt. We assess that a more sustainable approach is to provide
incentives, technical assistance, loan guarantees and political
risk insurance.
As the Committee rightly notes, Development Impact
Bonds are a relatively new concept bringing together private investors,
non-profit and private sector service delivery organizations,
governments and donors to deliver results that society values.
DFID's Private Sector Department has been exploring the concept
in some detail, but the option will require further scoping in
the OPTs, in part because of the very high risk environment for
investors.
Nevertheless, we continue to engage closely with
the Portland Trust and a number of other organisations on possible
further support for private sector development.
Recommendation 5: We note
the huge benefits which greater access to Area C would bring to
the Palestinian economy. (Paragraph 25)
Agree.
Area C makes up more than 60% of the West Bank and
is largely off-limits for Palestinian use. It includes much of
the agricultural land in the West Bank, access to the Dead Sea,
and valuable natural resources in the Jordan Valley. Improved
access to Area C is key to future Palestinian economic growth:
the World Bank estimates the total potential value added from
alleviating today's restrictions on access to, and activity and
production in, Area C is likely to amount to some USD 3.4 billion
- or 35 percent of Palestinian GDP in 2011.[6]
Development of Area C would also increase the PA's tax base.
Recommendations 6 & 7: While
there are disagreements about the extent of the difficulties faced
by Palestinians in obtaining construction permits, it is clear
that the difficulties have a major negative impact on the Palestinian
economy, for example on businesses seeking to expand.
We recommend that the UK press the Israeli authorities
to grant significantly more construction permits than they have
thus far been willing to do. (Paragraph
34)
Agree.
The restrictive planning regulations in Area C continue
to make it very difficult for Palestinians to obtain the required
permits to build legally. Less than 1% of Area C is currently
planned for Palestinian development.[7]
Building without a permit leaves properties at risk of demolition
by the Israeli authorities. This severely restricts Palestinian
communities and businesses from expanding and developing to meet
their needs.
Enabling Palestinians to stay in their homes on the
land in Area C is also vital for the contiguity of a future Palestinian
state.
We raise this issue regularly with the Israeli authorities,
urging Israel to ease restrictions on Palestinian construction
and to transfer responsibility for planning in Area C to the Palestinian
Authority. We will continue to do so at the highest levels.
Recommendations 8 & 9: The
demolition of many Palestinian structures is contrary to international
law. We recommend that the UK seek to persuade the Israeli
authorities to refrain from such demolitions where the UK believes
such structures are justified. UK representatives should engage
with Israeli officials as soon as demolition orders are issued
where the UK believes these structures are justified. We also
recommend that DFID scale up the important work it is already
doing to help Palestinians to contest demolition orders in the
courts. (Paragraph 35)
Partially agree.
We are gravely concerned by demolitions and displacement.
Demolitions cause unnecessary suffering to ordinary Palestinians;
are harmful to the peace process; and, in all but the most limited
circumstances, are contrary to International Humanitarian Law
(IHL). We have repeatedly made clear to the Israeli authorities
our serious concern at demolitions of Palestinian properties,
and will continue to do so at the highest levels.
DFID is currently supporting the Norwegian Refugee
Council (NRC) to provide legal aid to vulnerable households at
risk of losing their homes to demolition. This approach is successful:
demolition orders are suspended in 95% of cases in Area C and
East Jerusalem that receive legal aid through NRC. This support
will continue to be important as long as the Israeli planning
and permitting regime in Area C does not allow Palestinian communities
to build legally.
However, enabling Palestinians to stay in their homes
on the land will ultimately require a more comprehensive approach.
Through the Conflict Pool, the UK has supported the International
Peace and Cooperation Centre (IPCC), to work with Palestinian
communities on long-term planning in East Jerusalem and Area C.
IPCC report that no demolitions have taken place in any of the
32 areas where they have prepared UK-funded plans. In addition,
DFID's £6.2million programme of support in Area C will help
to restore agricultural wells serving nearly 1,000 farming families,
thus enabling them to work more productively. We will also provide
further technical assistance to help Palestinian communities to
deliver high quality Outline Plans for submission to the Israeli
planning system.
We will keep our funding to NRC under review but,
rather than automatically scaling up this work as the Committee
suggest, we will consider the value of doing so against further
planning activity and supporting the building of infrastructure
in planned areas.
Recommendation 10: Israelis
have justifiable concerns about the nature and objectives of Hamas
and its role in the PA government, but this should not prevent
the Government of Israel from taking forward actions that remove
obstacles to the development of Palestinian communities in Area
C; specifically the process of developing "Master Plans"
for communities in Area C should not be frozen as part of the
suspension of Israel's peace negotiations with the Palestinians.
(Paragraph 36)
Agree.
We agree with the Committee that political disagreement
should not prevent progress on the development of Palestinian
communities in Area C.
We note the UN's appeal to the Israeli Civil Administration
in September 2014 to approve 90 Palestinian community-owned outline
plans as a "welcome first step towards addressing planning
needs for all Palestinian communities."[8]
Our approach to development in Area C, in close cooperation with
the UN, has been to engage constructively with the Israeli authorities
to help Palestinian communities to plan for their future. We now
need to see urgent movement on this issue.
We welcomed the Israeli decision to approve two UK-funded
Palestinian-owned masterplans (covering three communities) earlier
this year. Many more, however, are awaiting approval. We raise
this issue regularly with the Israeli authorities and will continue
to do so.
Recommendations 11 & 12:
Israeli settlements in the OPTs are illegal under international
law, and we consider them to be unacceptable. The presence of
the settlements, and the consequent inability of Palestinians
in Area C to control their own resources, severely restrict the
Palestinian economy. We are extremely concerned about the potential
for further settlement expansion, especially around Jerusalem.
Palestinians and some Israelis and Israeli organisations we met
believe that the international community could exert its influence
to restrict the expansion of settlements if it were to take firmer
measures to show its condemnation of the settlements.
The UK should in concert with other European countries
stress to the Israeli authorities the unacceptability of the present
situation. DFID should also support the World Bank programme which
is helping the Palestinian Authority with land registration.
(Paragraph 45)
Partially agree.
We have repeatedly condemned Israel's settlement
activity. We have made clear to Israel that settlements are illegal
under international law, an obstacle to peace, and undermine those
working for a sustainable peace. We raise the issue of settlements
on a regular basis with the Israeli authorities, including through
Ministerial statements, demarches and Ambassadorial summons as
appropriate. We are also clear that Israeli outposts in the West
Bank and East Jerusalem, illegal under international law and
Israeli law, should be removed entirely.
Most recently, in response to the expropriation of
nearly 1,000 acres of West Bank land by Israel, the Prime Minister
and Foreign Secretary said the decision was "deplorable",
and urged the Israeli government to reverse it. The Foreign Secretary
also "deplored" the Israeli government's decision to
advance plans for 2610 settlement units in Givat Hamatos. We will,
in close coordination with our EU partners, continue to stress
the unacceptability of the current situation to Israel in the
strongest terms.
This stance is complemented by a concerted effort
to increase the information available on settlement activity.
Through the Conflict Pool, the UK has funded a number of projects
to monitor and report on settlement expansion in East Jerusalem
and the West Bank and to protect vulnerable Palestinian communities
from the effects of settlement expansion. In 2013/14, the Conflict
Pool supported two NGOs - Terrestrial Jerusalem and Peace Now's
Settlement Watch - to work on these issues.
DFID officials have engaged with the World Bank and
the UK Land Registry in recent months on land registration in
the OPTs. Responding to the Gaza crisis has, however, placed increased
pressure on our resources and necessitated a shift in our portfolio
to include more humanitarian and early recovery work. Although
all programme options will continue to be kept under review, we
cannot at this point commit to supporting this specific programme.
Recommendation 13: We
welcome the UK's decision to introduce labelling guidelines calling
for products made in Israeli settlements to be labelled as such:
this allows consumers to make an informed decision as to whether
they wish to purchase such products. We continue to support strong
economic ties between the UK and Israel. However, we consider
that it is very important to find out whether the introduction
of labelling guidelines for products made in Israeli settlements
has been effective, including whether they have been implemented
by major retailers and what effect they have had on the sales
of products from the settlements in the UK. We strongly recommend
that the UK Government undertake a review of the implementation
and impact of the introduction of labelling guidelines. We also
recommend a review of the initial impact of the introduction of
the 2013 EU guidelines on the territorial application of EU funding.
(Paragraph 46)
Partially agree.
We welcome the Committee's acknowledgement of the
leading role the UK played in developing the voluntary labelling
guidelines. We have since shared our experience of implementing
this scheme with other interested countries. We understand that
multiple British retailers who have stocked settlement produce
have adopted the labelling policy recommended in Defra's voluntary
guidance. Defra is currently reviewing the impact of its guidelines
with retailers.
In addition to voluntary labelling guidelines, we
welcomed the commitment by Baroness Ashton to engage on the issue
of EU-wide guidelines on the labelling of settlement produce.
The UK has also placed advice on the UKTI-FCO Overseas Business
Risk website to raise awareness of the risks British businesses
may face when operating abroad, including in Israel and the OPTs,
and guidance on potential risks associated with operating in the
settlements. A number of other EU governments have adopted a similar
policy in the time since.
The UK supported the EU guidelines which were published
in July 2013 and came into effect on 1 January 2014 to distinguish
between Israel and Israeli settlements in EU agreements and funding
programmes. As these guidelines formalise long-standing UK and
EU policy on settlements, they have not had an impact on EU funding
allocations. However, reporting from Posts and in the Israeli
media suggest that these guidelines had a significant political
impact locally on the Israeli debate around settlements.
Recommendations 14 & 15: We
were shocked by what we saw during our visit to Hebron especially
the impact of settlements, which are illegal under international
law, on the daily lives of Palestinians. The restrictions on Palestinians
have an entirely unacceptable impact on their livelihoods, economic
development and security.
We recommend that the Government put pressure
on the Israeli authorities to lift these restrictions as a matter
of urgency. (Paragraph 48)
Agree.
Hebron is the largest city in the West Bank. It has
the potential to be a hub for Palestinian industry and commerce
given the natural resources in local marble quarries. Instead,
its Palestinian population live an extremely difficult existence,
as the Committee saw for themselves.
We have raised concerns about Hebron, including on
settlements and the conduct of the Israeli Defence Force, with
the Israeli authorities, and will continue to do so where appropriate.
Recommendations 16 & 17:
We are concerned that Breaking the Silence no longer receives
Conflict Pool funding. It is a unique and credible voice which
speaks to Israelis about what is done in their name.
We recommend that the Government reinstate funding
for Breaking the Silence. (Paragraph
49)
Disagree.
The British Government supported Breaking the Silence's
public education programmes in 2009-11 through the Conflict Pool.
Our support totalled £38,233 in 2009-10 and £74,434
in 2010-11 for their 'Hebron Educational' and 'Educating for Change'
projects.
The decision not to continue funding when these programmes
finished was taken because it was judged that there were other
projects which could more effectively deliver our Conflict Pool
objectives in Israel and the OPTs.
We keep all projects supported by the Conflict Pool
under review on a regular basis and will continue to do so under
the new Conflict Stability and Security Fund (CSSF). We would
consider any future application from Breaking the Silence fairly
and in line with the principles for our support.
Recommendations 18 & 19:
While we note the comments of the Israeli Embassy, we are deeply
concerned about the continuing validity of the restrictions on
Palestinians' access to water in Area C under the interim Oslo
II agreement.
The UK should use its influence to encourage Israel
and Palestine to reach a more satisfactory agreement about water
resources, allowing Palestinians equitable access to the water
resources in the West Bank. (Paragraph
50)
Agree.
Water resources are limited and must be shared fairly.
At the moment, this is not the case: Israel retains almost exclusive
control of all underground and surface water resources in the
West Bank, the construction of new wells and cisterns, and the
upgrading of existing wells and other water infrastructure. Water
and sewage issues were agreed on an interim basis at Oslo more
than twenty years ago and, although Israel provides more water
than was mandated at Oslo, this is not sufficient to address the
needs of the Palestinian population today. In fact, around 200,000
Palestinians in the West Bank have no access to water network
connections[9]
and in remote communities water consumption can be as low as 20
litres per person per day - one fifth of the World Health Organisation's
recommendation.[10]
In contrast, the UN estimates that Israeli settlers in the West
Bank consume approximately six times the water consumed by Palestinians.[11]
Meanwhile, in Gaza, the UN has estimated that by
2020 unless action is taken "there will be virtually no reliable
access to sources of safe drinking water."[12]
The destruction of water, sanitation and energy infrastructure
during the violence this summer has made the situation even worse:
450,000 people in Gaza are currently unable to access water due
to damage and/or low pressure.[13]
This situation is not sustainable.
Water is one of the eight sectors in the Office of
the Quartet Representative (OQR)'s Initiative for the Palestinian
Economy (IPE) - a plan to boost private sector-led economic growth
in the OPTs. Their plans include improving water and waste water
management and extracting additional water from available sources,
including desalination. The UK supports the work of the OQR through
seconding two DFID advisers to the organisation. The success of
the IPE, however, as with other private sector activities, will
ultimately depend on enabling actions from Israel.
We will continue to raise concerns regarding water
resources and restrictions on movement and access more generally
with the Israeli authorities with the aim of reaching a more sustainable
and fair arrangement.
Recommendation 20: Despite
the Fatah-Hamas reconciliation, we recommend that the UK encourage
both sides to resume discussions in the Joint Technology Committee
(JTC), with a view to enabling users with Palestinian SIM cards
to access 3G services and to undertake to reach rapid agreement
on 4G services when they are technically available. (Paragraph
51)
Agree.
Strong telecommunications are vital for any modern
economy - the restrictions on access to the full mobile spectrum
for Palestinian operators in the West Bank make economic growth
more difficult to achieve and sustain. We agree with the Committee
that progress on this should not be held hostage to political
difficulties.
Officials in Tel Aviv have raised the issue of 3G
access for Palestinians with the Israeli authorities. Telecommunications
is also a key sector in the OQR's Initiative for the Palestinian
Economy, which seeks to create a level playing field with Israeli
operators, including the deployment of 3G and 4G services.
Recommendation 21: We
fully appreciate Israel's legitimate security concerns in respect
of the Gaza strip, especially in the light of recent events, including
rocket attacks on Israel from Gaza. However, we do not believe
that all the present arrangements, notably those which affect
travel and trade are proportionate. Some are contrary to Israel's
obligations under international law and also run the risk of making
the security situation worse. (Paragraph 60)
Agree
We agree that Israel has legitimate security concerns.
The events of this summer showed very clearly the threat to Israeli
citizens from indiscriminate militant rocket fire, for example.
Israeli restrictions on the movement of goods and
people, however, do very serious damage to the economy and living
standards of ordinary people in Gaza. Restrictions are estimated
to cost the Palestinian economy in excess of £1.3billion
a year.[14]
Stifling the economy of Gaza is counterproductive: an improved
economy is not only essential for the people of Gaza, but firmly
in Israel's security interests. We judge that Israeli restrictions
on Gaza serve to strengthen Hamas. In addition, as the Occupying
power, Israel is obliged under international law to provide for
the safety and welfare of civilians living in the Gaza Strip.
In the aftermath of the conflict this summer, it
is vital that the parties engage in negotiations to reach a sustainable
and durable agreement which tackles the underlying causes of the
conflict in Gaza. It is only this which will put a stop to the
cycle of violence. This agreement should ensure that Israel progressively
lifts restrictions in order to ease the suffering of ordinary
Palestinians, and allow the Gazan economy to grow. It should also
ensure that Hamas and other militant groups permanently end rocket
fire and other attacks against Israel; and that the Palestinian
Authority resumes control of Gaza and restores effective and accountable
governance. The UK stands ready to support such an agreement.
Recommendation 22: Given
the current situation in the Gaza Strip, it is understandable
that the Government of Israel is unwilling to engage in discussions,
but, nevertheless, we recommend that the UK encourage the Israeli
authorities to lift those restrictions which are not justified
by security needs. The UK should also seek to persuade Israel
to consider what steps it might take to improve the availability
of water and electricity in Gaza. (Paragraph
60)
Agree.
In close co-ordination with our EU partners and the
OQR, we continue to press the Israeli Government at ministerial
and official level to ease the restrictions on Gaza, and to take
actions which will improve the chronic energy and water shortages
and to promote exports from Gaza to Israel and transfers to the
West Bank. For example, during the recent Gaza crisis, we engaged
with Israel on the need to repair electricity feeder lines and
water pipes into Gaza to help meet the urgent humanitarian needs.
Even before the crisis, Gaza's electricity supply
only met 46% of demand and there were rolling power outages of
up to 12 hours per day.[15]
Replacing the medium-voltage feeder lines in Gaza with a 161kv
high-voltage electricity transmission line from Israel would increase
electricity supply in Gaza by 30 MW per day - a 25% increase on
the 120MW currently provided by Israel.
This would have major benefits for the local population,
including helping to increase Gaza's agricultural and industrial
output and enabling hospitals to function more effectively. It
would also help address the treatment of sewage which affects
both Palestinians and Israelis: up to 90 million litres of partially
treated sewage are discharged into the Mediterranean Sea every
day.
We continue to raise this issue with the Israeli
authorities.
Recommendation 23: We
recommend that DFID scale up its work supporting exports from
Gaza. DFID should also support the implementation of existing
plans to open Gaza's port, and work to facilitate travel between
Gaza and the West Bank, possibly by developing plans for a travel
corridor. (Paragraph 61)
Partially agree.
We agree with the principle of the Committee's recommendation:
we are clear that improved movement of goods and people is vital
for sustainable economic development in Gaza. We want to see the
ban on Gazan exports to Israel and transfers to the West Bank
- Gaza's natural markets - lifted. Without a substantial export
market, measures to increase agricultural and industrial output
will not be able to grow the economy.
We would need to see this change before any further
work in this area could have a lasting development impact. In
the past, DFID has provided targeted support to facilitate textile
exports to the UK. The impact of such support will always be limited,
however, unless the underlying issues are addressed.
Similarly, the development of Gaza's port can only
ever be a secondary consideration which would make little to no
impact on economic growth unless trade restrictions are lifted.
The free flow of goods in and out of Gaza needs to happen first
before a port could function effectively and make a transformative
impact.
We will continue to urge Israel to lift the ban on
Gazan exports to Israel and transfers to the West Bank and to
ease restrictions on the movement of people between the two. We
will keep this situation under close review as the ceasefire negotiations
over Gaza evolve.
Recommendation 24: Israel
is a democracy with a strong entrepreneurial culture. We saw in
the OPTs similar dynamism and enterprise, which we wish to see
encouraged. So much could be achieved if Palestinians and Israelis
could work together to foster economic development. We fully understand
and appreciate Israeli security concerns, especially in view of
the recent murder of three Israeli teenagers outside Hebron and
the continuing rockets attacks on Israel from the Gaza Strip.
Some of the evidence we were given on our visit are difficult
to reconcile with that subsequently provided by the Israeli Embassy,
but we were shocked by what we saw in the OPTs. We saw a country
whose people have known immense suffering now imposing conditions
on their Palestinian neighbours which cause a different but very
real suffering and often without real security justification.
We saw Israel taking a range of actions that hinder Palestinian
economic development and must, at the very least, cause deep resentment
on the Palestinian side, even amongst the most moderate and pragmatic
people, and so will actually worsen Israel's own security. (Paragraph
62)
Agree.
We agree with the Committee that the impact of Israeli
restrictions on the Palestinian economy is extremely serious.
We agree that Israel has legitimate security concerns, but we
do not believe that extremists on either side should be allowed
to derail wider progress on either development or political issues.
We continue to believe that increased prosperity
in the OPTs is firmly in Israel's interests. DFID is helping to
build strong and accountable government institutions and an effective
economy so that a future Palestinian state will be stable, prosperous
and a partner for peace with Israel. We judge that both populations
would be better off if political and economic relations were improved
between the two.
We continue to urge Israel to ease those restrictions
in order to facilitate this development.
OPTs: DFID's programme
Recommendations 25 & 26: DFID's
support is helping to prepare the PA for the assumption of governmental
functions in a future Palestinian state. DFID's financial support
is critical to the PA's operation, especially giving its ongoing
financial crisis.
UK policy remains to support a two-state solution
and DFID should continue to provide funding to the Palestinian
Authority. (Paragraph 67)
Agree
The PA is essential to a two-state solution - it
represents the nucleus of a future Palestinian state and demonstrates
the ability of the moderate Palestinian leadership to govern by
the rule of law and deliver results. Delivering basic services
including security and safety in the areas under its direct control
and paying the salaries of public sector workers is vital to maintaining
stability and reducing poverty.
Restrictions on movement and access and on-going
conflict mean that the PA suffers from a chronic budget deficit
and relies on donor support. Two-thirds of domestically-sourced
revenue is outside of the PA's control and the Palestinian economy
is artificially stifled by Israel's movement and access restrictions.
Despite efforts to increase revenues and reform spending, aid
still forms around 40% of the PA budget. Until movement and access
restrictions are lifted, it will be difficult for the PA to significantly
increase revenues from taxes paid by Palestinian businesses.
Nevertheless, the PA has made important progress
on state-building, which has been repeatedly recognised by the
World Bank and IMF. The UK is one of the principal supporters
of Palestinian state building efforts, assisting the Palestinians
to tackle poverty, build institutions and boost their economy
under Occupation-related movement and access restrictions.
The State building pillar of our bilateral programme,
totalling £151million from 2011-2015, is helping the PA to
build strong institutions and deliver improved public services.
In the last year, this has included:
· Support
for 6000 children in primary education;
· 550
pregnant women attending antenatal care in the West Bank; and
· Over
8000 poor individuals receiving cash transfers.
DFID has also helped to achieve savings worth at
least $100m to the PA from the implementation of reform measures
agreed with the World Bank, and has improved public financial
management through technical assistance and strengthened anti-corruption
controls.
We are also working to support measures to make the
PA more accountable. We are supporting citizens to undertake
social accountability activities to enhance responsiveness and
accountability of the key state institutions and improve service
delivery within their local communities. This includes helping
to make the security and justice sector more responsive and accountable,
and supporting women victims of violence.
Recommendations 27 & 28: We
are nevertheless concerned that DFID is not taking adequate measures
to prevent its funds from being misused. Given the scale of the
operation, with 85,000 civil servants being paid with UK money,
there is a serious risk of abuse. We do not regard a six-monthly
audit as an adequate protection to secure the integrity of UK
aid funds.
We recommend that DFID impose more stringent checks
to ensure that the money it provides to the PA is not being misused
while pursuing a constructive dialogue with the PA on the end-use
of funds. (Paragraph 68)
Disagree.
UK funding to the Palestinian Authority is used to
pay civil servant salaries only. The funds are channelled through
a trust fund administered by the World Bank and only named and
vetted civil servants from a pre-approved list are eligible. The
list of beneficiaries is checked against international (including
Israeli) and ad hoc sanctions lists.
Payments are made in quarterly tranches. Before the
release of each tranche, DFID Ministers are consulted on the decision.
Information on the PA's fiscal need, performance against pre-determined
indicators, and any political risks are carefully considered.
A full audit is conducted for every second payment:
this independent audit evidence has confirmed that DFID funds
have been disbursed as intended.
As a result, we are confident that we have stringent
processes in place to ensure the integrity of UK funds. In short,
we know exactly where and how our money is being spent.
Recommendations 29 & 30:
We are also extremely concerned about the PA's policy of paying
salaries to the families of Palestinian prisoners in Israeli jails.
While appreciating it is a sensitive issue, issuing payments to
families based on the length of jail terms, rather than need,
is a political and not a welfare decision and thus unacceptable.
In addition, while the British Government maintains that no UK
money supports this activity, UK aid payments fund the payment
of PA civil servants. It could therefore be said with some justification
that this payment of UK funds enables the PA to release alternative
funds which allow these payments to continue and which might alternatively
be used more effectively to cover other needs. The Palestinian
Finance Minister confirmed that the payments were a serious burden
on the PA's finances.
We urge the UK to help the Palestinian Authority
stop these payments and to replace them with welfare payments
to prisoners' families based on poverty levels and need.
(Paragraph 69)
Partially agree.
As the Committee has noted, prisoners are a very
sensitive political issue on both sides of the Israeli-Palestinian
conflict. The release or exchange of prisoners is frequently an
important political act as part of MEPP negotiations. It is also
something that affects a great many Palestinians: around 70% of
Palestinian families have had one or more members detained.
In this context, PA Ministers have made clear both
in public and to UK Government officials that payments to families
are intended to sustain those whose primary breadwinner has been
imprisoned. Indeed providing support, care, protection and rehabilitation
to detainees, ex-detainees and their families is a key objective
in the Ministry of Social Affairs' strategy for 2014-16. This
strategy was developed through a consultative process and is aimed
at reducing poverty, food insecurity and unemployment and promoting
social justice.
President Abbas has recently authorised the establishment
of a commission under the PLO to manage these payments. The implementing
mechanism and exact role of the PA are still being considered.
Nevertheless, until now, the burden these payments places on the
PA has been serious, and may continue to be so under the new system.
We will continue to urge the PA to ensure that any involvement
is based on efforts to make these payments transparent, needs-based
and part of an affordable welfare system.
We have robust accounting procedures in place which
mean we are confident that we are not funding these payments.
In addition, like the rest of the international community (including
Israel which collects and transfers 70% of the PA budget through
clearance revenues) we think it is of paramount importance to
support the PA in maintaining economic and social stability in
the West Bank.
Recommendations 31 & 32: UNRWA
is a key provider of public services in the Palestinian territories,
and it is only able to fulfil this role thanks to the contributions
made by donors such as DFID. Donor funding to UNRWA plays a crucial
role in preventing great hardship in the OPTs.
We recommend that DFID continue to provide funding
to UNRWA. While there are weaknesses in UNWRA s work, it has made
improvements, but DFID must maintain pressure on the organisation
to make further efficiencies. (Paragraph
73)
Agree.
We welcome the Committee's recognition of the important
role that UNRWA plays as a service provider for Palestinian refugees.
In fact, UNRWA provides essential support to nearly 5 million
registered Palestinian refugees across the region, not just in
the OPTs. Their work has come under increased pressure recently
following events in Syria and, more recently, in Gaza. There were
540,000 registered Palestinian refugees in Syria at the start
of the crisis. Almost all have been affected. In Gaza this summer,
nearly 300,000 internally displaced people sheltered in UNRWA
schools, and relied on the agency to provide vital emergency assistance.
We already play an influential and constructive role
with other donors on supporting reform in UNRWA, with £31.5m
out of our £106.5m contribution to the General Fund linked
to progress on results and reform. We will continue to support
this through our influential role on the Sub Committee and Advisory
Commission as the third largest donor to UNRWA's General Fund.
We are working closely with UNRWA to plan for and
implement their Medium Term Strategy (2016-21) which will help
them to make the tough decisions needed in the coming years to
maintain core education, health and social relief service delivery
in the context of a recurrent budget deficit. This will involve
work to manage its cost base, especially staff salaries which
are the major driver, and to define what UNRWA should focus on,
what UNRWA should stop doing and what services the agency should
only provide in exceptional circumstances. We also continue to
urge UNRWA to focus on resource mobilisation and diversify its
donor base, including through greater contributions from Arab
donors.
Recommendations 33 & 34:
The health sector in Gaza is in a situation of grave crisis. Failure
to address this crisis as a matter of urgency will have severe
consequences.
Together with other donors, DFID should provide
funding for urgent medical supplies in Gaza. DFID should also
reinstate the health sector as a key priority within its Palestinian
programme, as it is clear that the circumstances which led to
its de-prioritisation no longer apply.
(Paragraph 77)
Partially agree
We agree that the latest outbreak of hostilities
in Gaza this summer put serious pressure on health infrastructure
and services. The UN report that 62 hospitals and clinics were
damaged during Operation Protective Edge. This is in fact not
a new problem: drug shortages have been a problem in Gaza since
2007 and a growing population combined with structural damage
to health infrastructure is putting an increasing strain on services.
DFID, however, is already supporting work in the
health sector, including getting medical supplies into Gaza. We
are the third largest donor to UNRWA which provides medical services
to the 70% of the population in Gaza who are Palestinian refugees.
Our support enabled UNRWA to continue providing basic health services
during the latest conflict through 13 of its 21 clinics. Our
support to the PA, meanwhile, enables them to deliver essential
services such as health and education. We are also providing £10m
to the International Committee of the Red Cross between 2013 and
2015 to deliver emergency medical services and rehabilitate hospitals
in Gaza. Last year nearly 195,000 patients were treated at 8 ICRC-supported
medical facilities in Gaza. Finally, we support the UN Access
Coordination Unit (£1.1million 2011-15) to work with the
World Health Organisation, Israel, the Palestinian Authority and
aid agencies to facilitate the transfer of medical equipment and
supplies and patient referrals in and out of Gaza.
In addition, in response to the crisis this summer,
the UK deployed a world class team of UK medical staff directly
to the region to assess the need for specialised medical assistance
from the UK and to see if there were patients who would benefit
from transfer to the UK for treatment. We also provided an additional
£3million to the World Food Programme who provided emergency
food rations to more than 2,000 patients and staff. Our support
delivered through NGOs from the Rapid Response Facility helped
to ensure more than 480,000 people received immediate healthcare
and that hospitals received essential drugs and emergency medicine
kits.
We judge that our support for continued basic service
delivery, including healthcare, through the PA and UNRWA should
remain at the heart of our programme. Should another crisis situation
arise, we will be ready to respond.
Recommendations 35 & 36: If
a two-state solution is to be achieved, it will require genuine
support and buy-in from ordinary people on both sides. This cannot
and should not be taken for granted. On the contrary, concrete
steps should be taken to strengthen the appetite for peace on
both sides of the divide.
We recommend that the UK fund a significant number
of people-to-people projects in Israel and the OPTs, either through
DFID, the Conflict Pool or the new Conflict, Stability and Security
Fund. As part of this, it should fund organisations, which can
bring together people of all faiths. We met a number of individuals
from organisations which appeared well equipped to do this, including
Cherish, the Bethlehem Bible College and other Palestinian Christian
organisations, which we met at the college.
(Paragraph 85)
Partially agree.
The new Conflict, Stability and Security Fund will
look to continue some of the UK's work on working with NGOs in
Israel and the OPTs to build constituencies for peace.
There has however been mixed experience of joint
Israeli-Palestinian people-to-people projects in the past amongst
the donor community, particularly in terms of weak results, scalability
and demonstrable strategic impact. The high transaction costs
of running multiple small projects can also be a binding constraint.
Nevertheless, DFID is open to considering strong joint projects
that would deliver positive impact in line with our Operational
Plan objectives, where they would represent value for money, and
where they are in line with requirements for how DFID funds may
be used.
Recommendation 37: The
progress on peace talks has been frustrating and difficult, but
failure to reach an agreement eventually would have devastating
consequences on both Israelis and Palestinians. In view of this,
we believe that it is essential that the UK continues to support
the talks, keep hopes of peace and the two state solution alive
and to provide funding to support the Palestinians, especially
in view of the UK's role in the history of the area. (Paragraph
87)
Agree.
Resolution of the Israeli-Palestinian conflict remains
a UK foreign policy priority. We will continue to do all we can
to support the realisation of the two state solution, encourage
the parties to a return to talks and to support Palestinian state-building
in close cooperation with our international partners. Ultimately
though, a negotiated two-state solution will require bold leadership
to make the goal of two states living side by side in peace and
security a reality.
1 IMF, Report to the Ad Hoc Liaison Committee, 12 September
2014. Back
2
IMF, Report to the Ad Hoc Liaison Committee, 12 September 2014. Back
3
Q2 2014 labour force statistics, Palestinian Central Bureau of
Statistics. Back
4
Peace Now, March 2014, using figures from Israeli Central Bureau
of Statistics. Back
5
OCHA, The Gaza Strip: The Humanitarian Impact of Movement Restrictions
on People and Goods, July 2013. Back
6
World Bank, Area C and the Future of the Palestinian Economy,
October 2013. Back
7
OCHA, Area C of the West Bank: Key Humanitarian Concerns, January
2013. Back
8
Office of the United Nations Special Coordinator for the Middle
East Peace Process, Report to the Ad Hoc Liaison Committee, 22
September 2014. Back
9
Emergency Water Sanitation and Hygiene in the Occupied Palestinian
Territory, www.ewash.org Back
10
OCHA, Area C of the West Bank: Key Humanitarian Concerns, August
2014. Back
11
OCHA, Fragmented Lives: Humanitarian Overview 2012, May 2013.
Back
12
UN Country Team, Gaza in 2020: A liveable place?, August 2012. Back
13
OCHA, Gaza Strip: Humanitarian Dashboard, September 2014. Back
14
Ministry of National Economy, 2011. Back
15
OCHA, The Humanitarian Impact of Gaza's Electricity and Fuel Crisis,
March 2014. Back
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