The European Union – the Commission and the member states – has provided more than 5.6 billion euro assistance to the Palestinian people since 1994 to support the dual objective of bringing about the two-state solution and ending the Israeli-Palestinian conflict. Since the split between the Hamas and the Fatah (2006-2007-2008), its largest programme in the West Bank and Gaza Strip (WBGS) has been PEGASE Direct Financial Support (DFS), which provided approximately €1 billion in funding from 2008 to 2012 programme by making a significant contribution to covering the PA’s salary bill. In Gaza, it literally meant ‘free money’ since civil servants have been basically received salary without even going to their workplaces.
A recent audit published in December by the European Court of Auditors (ECA) draws attention to the unsustainability of the DFS. It is needed, as noted by the authors of the report, to encourage “the PA to undertake more reforms, notably in relation to its civil service.” Since more than 70 percent of the total funding was meant to cover salaries and pensions in the WBGS for more than six years, the situation offers a new opportunity to reform the PNA. It is worthwhile to recall Tagdishi-Rad analysis which runs as follows: ‘blaming the recipient country’s domestic governance structures and economic policies for the ineffectiveness of aid provided a venue through which (…) donors could justify their continued presence and interventions in the developing world’ (Taghdisi-Rad 2011: 22). Putting aside the motives and justifications, it is even more interesting that “no performance indicators were included in the financing agreements for Pegase DFS, which makes it harder for the EEAS, the Commission and the Member States to assess the concrete results of the support.” (ECA 2013: 17). It is a question whether this generous handling of indicators applies elsewhere in the region from the perspective of the post-Arab Spring’s ‘more for more’ approach…
ECA (2013): European Union Direct Financial Support to the Palestinian Authority. Special Report 14/2013, http://www.eca.europa.eu/Lists/ECADocuments/SR13_14/SR13_14_EN.pdf
Taghdisi-Rad, S. (2011) The political economy of aid in Palestine: relief from conflict or development delayed? London: Routledge