What is the state hiding? The ministries of defense, foreign affairs, and finance recently placed a confidentiality tag on a "loan" to the Palestinian Authority totaling at least half a billion shekels.
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The significance of the secret loan is that it debilitates the Israeli law that deducts the salaries the PA pays to terrorists – otherwise known as its pay-for-slay policy – from taxes Israel collects on the PA's behalf. The loan was approved for transfer this summer by Defense Minister Benny Gantz, after his meeting with PA President Mahmoud Abbas. Meanwhile, Israel Hayom has also learned that contrary to the wording of the law, the cabinet has yet to authorize the deduction of terrorist salaries for 2021.
As a reminder, in July 2021, the current government decided to deduct more than half a billion shekels from the PA's tax revenues to counter the stipends it paid to terrorists in 2020. Several weeks later, however, Gantz announced that Israel would grant the PA what he called a "loan" – apparently of half a billion shekels – equal to the sum that was frozen by the terrorist deduction law. At the time, Israel Hayom reported that the move was a source of tension between Gantz and Prime Minister Naftali Bennett.
Ever since Gantz's decision to grant the "loan," officials in the political and defense establishments have refused to provide information about its precise scope, due dates, interest rates, and who exactly it is being transferred to in the PA, which according to numerous international reports is rife with corruption. The "Lavi" citizen's rights and good governance organization recently asked the Jerusalem District Court to apply the freedom of information act to remove the veil of secrecy, but was denied.
Judge Yoram Noam, who was briefed behind closed doors on the need to keep the matter a secret by officials from the Foreign Ministry and the Coordinator of Government Activities in the Territories unit in the Defense Ministry, noted in his ruling the "concern that the state's diplomatic relations could be harmed…" and that this "concern isn't limited to relations with the PA, rather pertains to foreign relations with third-party sides." The belief is that the third party is the United States, which is pressuring Israel to help the PA economically.
According to attorney Yitzhak Bam of the Lavi organization, "The state is using the security excuse in vain. The money transfers help the PA to support terrorists and their families, and therefore the 'loan' constitutes direct aid to the funding of terror. Concealing the information bolsters the conclusion that the loan story is essentially a bluff, and that this is a grant."
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The Prime Minister's Office said in a statement: "The terror salaries report for 2021 is expected to be presented for approval soon."
The Foreign Ministry said, "Our position was voiced behind closed doors and we won't address this issue."
The Finance Ministry said in response that "no loan was given to the PA, rather the date was moved up to pay what the government is regardless expected to transfer to the PA in the future."
The Defense Ministry declined an Israel Hayom request to comment.
