Dr Charles Tannock

Member of the European Parliament for London

Let's Probe Aid to the Palestinians

The Wall Street Journal - February 4th 2003

The European Union has been paying about 10% of the Palestinian Authority's budget for almost two years. That's around 10 million euros a month. The money is supposed to pay the salaries of public-sector employees and sustain the administration in the Palestinian Territories. But there have been repeated allegations that some of this money has found its way into the hands of corrupt officials or, worse, has been used to fund terrorist attacks on Israeli civilians. Some of us in the European Parliament are sufficiently concerned by these charges to call for a formal Committee of Inquiry to investigate them.

Rather than welcoming this proposal, the European Commission, has obstructed it at every turn. It has argued that there is no evidence that the money has been misused, that a Committee of Inquiry would have the effect of making officials on the ground too scared to disburse funds and, lastly, that if the European Union were to stop giving funds it would lose its ability to influence the Peace Process. Chris Patten, the EU's external affairs commissioner, asserts with characteristic robustness that the International Monetary Fund has more control over the monitoring of EU aid to the PA than in any of its other programs around the world. To cease providing funds, he adds, would have a counterproductive effect by causing greater economic hardship among Palestinians, and ultimately more terrorism. Liberal and left-wing parties in Parliament have given Mr. Patten overwhelming support.

So are we simply to do nothing? I and other parliamentarians who have been leading the call for an inquiry now have the signatures of more than 157 colleagues -- a quarter of the parliament, thus meeting the requirements to authorize a full parliamentary debate and vote on launching an inquiry. Whether we will win that vote remains to be seen, but the pressure is already paying off. The commission, partly in response to our initiative, is now welcoming the idea of having a less powerful investigating committee than the one we've proposed. Theirs would be made up of members of three different committees. We're glad the commission is finally beginning to move, but this alternative lacks formal powers to summon officials or dedicated resources to carry out investigations.

Contrary to what Mr. Patten constantly says about IMF monitoring, Thomas Dawson, Director of the IMF's External Relations Department, wrote in a letter to this newspaper on June 17: "the IMF does not monitor foreign assistance to the PA. It simply provides the EU with info about broad developments related to its budget. It does not monitor or control every item in the budget. This obviously is an auditing function that goes far beyond the fund's present mandate." Even the Palestinians have realized that they need new financial control, and the PA has announced major reforms to improve accountability. Whether those reforms will take place remains to be seen, but it is a good sign that the respected Palestinian Finance Minister Salam Fayyad is to be given control over all funds.

Indeed, the apparent pressure for reform within the Palestinian territories -- no doubt in part a response to external pressure -- is one of the most hopeful signs of change from within. To his great credit, Mr. Fayyad has understood this, admitting openly on several occasions that the current system is too open to corruption. Contrary to the claims made by many on the left in the parliament, our initiative is not anti-Palestinian. Quite the reverse, it is the Palestinians who have most to gain by embracing reform and becoming a more credible partner in negotiations. Our initiative was prompted by a simple desire to ensure that EU funds are not misused for corrupt or, more disturbingly, terrorist purposes.

Ironically, I share many of Mr. Patten's views on how best to advance the cause of peace in that region. I hope that in the future the parliament and the commission will work together to ensure real accountability and transparency over how European taxpayers' funds are spent.

The European Union has been paying about 10% of the Palestinian Authority's budget for almost two years. That's around 10 million euros a month. The money is supposed to pay the salaries of public-sector employees and sustain the administration in the Palestinian Territories. But there have been repeated allegations that some of this money has found its way into the hands of corrupt officials or, worse, has been used to fund terrorist attacks on Israeli civilians. Some of us in the European Parliament are sufficiently concerned by these charges to call for a formal Committee of Inquiry to investigate them.

Rather than welcoming this proposal, the European Commission, has obstructed it at every turn. It has argued that there is no evidence that the money has been misused, that a Committee of Inquiry would have the effect of making officials on the ground too scared to disburse funds and, lastly, that if the European Union were to stop giving funds it would lose its ability to influence the Peace Process. Chris Patten, the EU's external affairs commissioner, asserts with characteristic robustness that the International Monetary Fund has more control over the monitoring of EU aid to the PA than in any of its other programs around the world. To cease providing funds, he adds, would have a counterproductive effect by causing greater economic hardship among Palestinians, and ultimately more terrorism. Liberal and left-wing parties in Parliament have given Mr. Patten overwhelming support.

So are we simply to do nothing? I and other parliamentarians who have been leading the call for an inquiry now have the signatures of more than 157 colleagues -- a quarter of the parliament, thus meeting the requirements to authorize a full parliamentary debate and vote on launching an inquiry. Whether we will win that vote remains to be seen, but the pressure is already paying off. The commission, partly in response to our initiative, is now welcoming the idea of having a less powerful investigating committee than the one we've proposed. Theirs would be made up of members of three different committees. We're glad the commission is finally beginning to move, but this alternative lacks formal powers to summon officials or dedicated resources to carry out investigations.

Contrary to what Mr. Patten constantly says about IMF monitoring, Thomas Dawson, Director of the IMF's External Relations Department, wrote in a letter to this newspaper on June 17: "the IMF does not monitor foreign assistance to the PA. It simply provides the EU with info about broad developments related to its budget. It does not monitor or control every item in the budget. This obviously is an auditing function that goes far beyond the fund's present mandate."

Even the Palestinians have realized that they need new financial control, and the PA has announced major reforms to improve accountability. Whether those reforms will take place remains to be seen, but it is a good sign that the respected Palestinian Finance Minister Salam Fayyad is to be given control over all funds. Indeed, the apparent pressure for reform within the Palestinian territories -- no doubt in part a response to external pressure -- is one of the most hopeful signs of change from within. To his great credit, Mr. Fayyad has understood this, admitting openly on several occasions that the current system is too open to corruption. Contrary to the claims made by many on the left in the parliament, our initiative is not anti-Palestinian. Quite the reverse, it is the Palestinians who have most to gain by embracing reform and becoming a more credible partner in negotiations. Our initiative was prompted by a simple desire to ensure that EU funds are not misused for corrupt or, more disturbingly, terrorist purposes.

Ironically, I share many of Mr. Patten's views on how best to advance the cause of peace in that region. I hope that in the future the parliament and the commission will work together to ensure real accountability and transparency over how European taxpayers' funds are spent.