Palestinian Authority Published Accounts

May 10, 2006

One of the achievements of donor countries has been to force a certain level of transparency in the financial accounts of the Palestinian Authority (PA). From January 2003 to December 2005, a monthly summary of the PA's accounts was published by its Finance Ministry's internet portal.

A summary of these accounts is now provided by the Funding for Peace Coalition, as a resource for interested parties. All amounts are shown in thousands of US dollars.

General Notes

1. In the PA, a wide network of quasi-governmental and non-governmental organisations, including UNRWA, perform services normally undertaken by governments. Many of these organisations are also funded by international donors. This means that the true level of international aid and public expenditure within the Palestinian Authority is not reflected in the published accounts. For example, USAID has provided over US$1.5 billion to such groups since 1993.

2. Many of these NGOs have been accused of following a highly politicised agenda, of facilitating violence and terrorist activity, or of exacerbating and extending the conflict between the parties. There is no evidence that some of these bodies are less tainted by charges of corruption than the PA.

3. The accounts of the PLO and the Palestine Investment Fund (which consolidates and manages PA financial and non-financial assets) are not available. Nor are the levels of reserves held by the PA itself. In the three-year period under review: $171 million was transferred to reserves; the Palestine Investment Fund transferred $173 million to the PA; PLO institutions received $55 million from the PA. Media reports would indicate that these three elements constitute vast undisclosed resources available to the PA.

4. Many public reports, including from the PA Attorney General, indicate that the transparency of posting accounts on the internet did not prevent large sums being diverted to corruption, violence and terror.

5. From time to time, significant retroactive adjustments have been made to the accounts as previously published on the internet. No attempt has been made to reconcile internal inconsistencies in the accounts as published.

6. The PA accounts have not been updated since the election of the Hamas government in January 2006. The summary below shows the accounts as posted on 10 March, 2006.

Expenses and Foreign Aid

From May 2004, certain countries channeled their donations via the World Bank. The "adjusted" column reallocates these amounts against the donor countries, so that a total for each country can be easily located.

PA Ministry of Finance - Summary of Expenses and Foreign Aid $US 000's

	Jan 2003 - Dec 2005

Total PA Expenditures		4,001,645
of which: Total Salaries & Wages		2,551,842
of which: Military Salaries		987,130

Direct Aid

		Adjusted**
World Bank Emergency Services Support Project	135,655	135,655
World Bank - Other Grants	20,000	20,000
World Bank - Loans	7,253	7,253
World Bank Trust - EU	122,924
World Bank Trust - Britain	21,300
World Bank Trust - Japan	40,000
World Bank Trust - France	3,300
World Bank Trust - Norway	32,827
World Bank Trust - Australia	2,450
World Bank Trust - Korea	600
World Bank Total	386,308	162,908

EU	112,794	235,718
Saudi Arabia	184,882	191,789
Saudi Arabia - Public committee	6,907
Norway	10,030	42,857
United Arab Emirates	21,450	21,450
Unites States of America	20,000	20,000
Lybia	15,113	15,113
Algeria	113,438	113,438
Kuwait	47,500	47,500
Canada	7,000	7,000
Britain	-	21,300
France	-	3,300
Palestinians Abroad	5,418	5,418
Qatar	15,399	15,399
Bahrain	3,300	3,300
Tunisia	1,650	1,650
Japan	1,260	41,260
Egypt	4,318	4,318
Oman	1,000	1,000
South Africa	500	500
Sudan	858	858
Greece	628	628
Turkey	30	30
Australia		2,450
Korea		600

Total Direct Foreign Aid	959,784	959,784

AID / TOTAL EXPENSE

Palestinian Authority Domestic Revenues $US 000's

	Jan 2003 to Dec 2005

Domestic tax revenues
Income tax *	165,468
Value-added tax **	252,928
Customs and duties	12,218
Property tax	4,635
Tobacco tax	137,307
	572,556
Domestic non-tax revenues
Stamp fees	14,319
Interior fees	36,927
Health fees	23,775
Health insurance fees	55,172
Transportation fees	54,326
Justice fees	46
Ministry of Agriculture fees	3,254
Labor fees	391
Local Government fees	1,311
Social Welfare fees	124
Supply fees	4,477
Sharia / Religious courts	4,136
Land Authority fees	12,476
Tourism fees	584
Post and Telecommunications fees	17,975
Education fees	2,739
National Security revenues	696
Higher Education revenues	357
Police revenues	4,805
Supreme Judicial Council	8,990
Ministry of National Economy	5,853
Earnings transferred from public corporations	226,040
Other fees	32,700
	511,474
Revenues Clearance ***
Customs duties	721,385
Value-added tax	697,787
Fuel tax	393,310
Health insurance	7,690
Income tax	7,770
Crossing Points fees	29,886
	1,857,829

Total gross revenues	2,941,858

Tax refunds	(110,964

Net revenues	2,830,894

* Personal income rates in the PA range from 5% to 20%. Wages on salaries are deducted at source. The corporate income tax rate is 20%.

** VAT is imposed on all local goods and services at a rate of 17%. Certain projects supported by the PA are exempt from VAT.

*** Clearance revenues are collected by the State of Israel and transferred to Palestinian Authority by force of agreements between the parties. During the period, Israel transferred an additional $476 million, which had been withheld from prior periods.

Detailed Expenses ($US 000's)

Detailed expenses for the period are shown against the ministries charged for the expense. As responsibilities shifted during the period, there are movements between lines. Where possible, the expenditures are shown in the ministry, which had the relevant responsibility at the end of the period.

		Responsible Entity		Jan 2003 to Dec 2005
1. Central Administration
	President's office			134,004
	P.L.O Institutions		#	54,994
	Palestinian Elections Committee		#	875
	Legislative Council			21,893
	Council of Ministers			4,309
	Secretariat of the Council of Ministers		*	2,009
	General Control Institute			3,733
	General Personnel Office			61,907
	Palestine Central Bureau of Statistics			7,506
	The commission of National Organizations Affairs			2,137
	Higher Commission for Finance and Investment		*	25
Total				293,393
2. Public Security and Order
	Ministry of Interior and National Security			1,182,392
	Ministry of Justice			16,072
	Supreme Judicial Council			21,494
	Land Authority			7,628
	Ministry of Local Government			19,484
	Ministry of Civil Affairs			13,710
	Office of the Supreme Justice			9,643
	Islamic Jurisprudence and Research Center			30,706
Total				1,301,126
3. Fiscal Affairs
	Ministry of Finance			58,408
	Ministry of Endowments			63,041
	Nongovernmental Organizations			20,667
	Water Authority			1,667
	Pension Allowances			101,657
	General Expenditures			11,970
	Public Debt Service			81,155
	Financial Reserves			170,594
	Development Expenditures			86,217
	PECDAR		*	802
Total				596,177
4. Foreign Affairs
	Ministry of Negotiations Affairs			1,317
	Embassies			47,257
	Political Department		*
	Ministry of Foreign Affairs		#	10,201
Total				58,438

5. Economic Development
	Ministry of National Economy			24,905
	Industrial Zone Board			1,402
	Specifications and Standards Office			2,389
	Investment Promotion Agency			1,736
	Energy and Natural Resources Agency			4,061
	Ministry of Planning			6,982
	Ministry of Public Works and Housing			28,649
	Ministry of Agriculture			40,428
	Ministry of Supplies		*	2,976
	Environmental Quality Authority			4,631
	Public Tobacco Board		*	831
Total				118,990
6. Social Services
	Ministry of Education and higher education			757,907
	Ministry of Health			393,217
	Ministry of Women Affairs			45,920
	Ministry of Prisoners Affairs			104,891
	Ministry of Labor and Social Affairs			211,872
Total				1,509,840
7. Cultural and Information Services
	Supreme Information Council			41,087
	Ministry of Tourism & Antiquities			9,382
	Ministry of Youth and Sports			17,549
	National Guidance Commission		*	7,892
	Ministry of Culture		#	5,742
Total				81,652
8. Transportation and Communications Services
	Ministry of Transportation			23,537
	Ministry of Telecommunications &Technology			14,196
Total				37,732

Total budget expenditures				4,001,655

	Net Lending¹			591,880

Grand Total				4,593,534

Ministries or functions merged into other line items during the period

Ministries or functions created or moved from other line items during the period

Net lending includes:-

(i) Payments by the PA of utility bills due to Israeli providers from local governments, which are deducted by the Government of Israel from clearance revenues;

(ii) Payments of fuel oil for the Gaza Electricity Generating Company, to ensure continued production and distribution of electricity in Gaza;

(iii) Exceptional advances to local governments.