Spørgsmål og svar vedr. EU´s hjælp til det palæstinensiske selvstyre
(Nedenstående er et brev af 16. december 2002 fra et medlem af Europa-parlamentet til EU Udenrigs-kommisæren Chris Patten vedr. evt. misbrug at EU´s midler til det palæstinensiske selvstyre. Chris Pattens svar af 21. januar 2003 følger nedenfor)
The Rt. Hon. Christopher Patten, European Commissioner for External Relations, European Commission, 200, rue de la Loi, 1049 Brussels
Strasbourg, 16th December 2002
Dear Commissioner Patten,
Please allow me to address you once again regarding the issue of the EU’s monthly direct budgetary assistance to the Palestinian Authority.
As you already know, great part of the EPP group is strictly against these monthly payments, since a follow up of the actual use of these resources cannot be satisfactorily guaranteed.In addition, I fear that the EU’s credibility, both among taxpayers, as well as our international partners is set at stake, through the numerous and very serious allegations of misuse of these funds. There is no need for me to set out here which devastating consequences this can have for the reputation of the EU, and in particular for the Common Foreign and Security Policy. The direct payments introduced by you, to an authority, whose president is obviously involved in terrorist activities provide further grounds for suspicion and supply eurosceptics with constant material for criticism on both the common foreign policy and the external affairs commissioner.
As you are also aware of, I have not yet supported the request put forward by many colleagues for the establishment of a committee of inquiry on the EU funding of the PA. I agree fully with the more than 120 delegates who have signed this request so far, and support them in their criticism of the PA matter. However, I have always believed in the joint resolution of problems through cooperation between our institutions.
I regret very much having to say that the efforts of the commission to throw light onto this subject are in my opinion insufficient and little convincing. Although there were numerous opportunities to discuss this topic during the past months, too many questions remain unanswered. From my point of view, neither you personally nor any commission officials have offered a clear declaration of your position concerning these questions.
Furthermore, I am disappointed by the behaviour of some of the officials of the commission, who attempted to and in some cases succeeded in encouraging proponents of the mentioned inquiry committee to withdraw their signatures. It is inevitable then that the suspicion arises that the commission has something to conceal.
My personal decision, as well as that of many of my colleagues, whether to support the request for a committee of inquiry in the coming weeks or not, depends therefore decisively on whether the Commission can give a satisfactory answer to the following important questions in connection with the EU budgetary payments
1. Is it really the case that only 55-66% of the sum allegedly needed for salaries by the PA was actually used for that means? How and through whom does the commission control which sum is needed for salaries and how much has been in fact paid out?
2. How many employees and civil servants does the PA employ (accurate number)? Does this number correspond with the expected number of employees as stated in the budget of the PA? Are these numbers regularly verified?
If so, how and by whom? How has the development of these numbers been since the first payment of EU budgetary assistance in June 2001?
3. Can you rule out the possibility that the PA authorities have been sustaining an unofficial shadow budget by means of a double-entry bookkeeping system?
4. Is it true that an obligatory fee of 1,5-2% is raised as “Fatah-membership-fee” on the salaries of the employees and civil servants of the PA paid by the EU? If this is not the case, how can the commission control this? Is it correct that the commission has stated that these “membership dues” are comparable to the fees paid to for example employee chambers in Saarland and Bremen or to Scandinavian or English trade unions? If so, do you agree with this statement? Do you consider this comparison appropriate?
5. Does the EU transfer the 10 million € monthly in Euro and the sum is then exchanged by the bank in Shekel or is the exchange directly performed by the PA? Who controls the exchange operation for the EU? Is it correct that before the introduction of the Euro as a currency in the year 2002, transactions were made in US-Dollar and that exchange rate speculations were possible?
6. Can you confirm that people suspected of being involved in the murder of Techiya Bloomberg (Farid Azouni and Samar Abu Hania) as well as the presumed wirepuller of the Bat-Mitzwa-Attack (Nasser Awis) are on the pay rolls of the PA authority? Are you aware of any other suspected terrorists, who receive salaries from the direct budgetary assistance of the EU as officials of the PA? How does the commission verify and control which people stand on the pay roll of the PA and which means are available to the commission, in order for it to exert influence on these pay rolls?
7. The Commission has assured several times that the ex-post control of the monthly EU payments by the IMF is satisfactory. However, leading IMF officials, for example Thomas C. Dawson, have stated that the IMF provides the EU only with information about general developments in connection with the budget but the IMF has no authority to control each individual position and the actual use of the fund. Do you actually believe that the so-called “supervision of budget implementation” by the IMF is sufficient in the light of the gravity of the allegations? Are there other institutions, beside the IMF, that control and supervise the use of the funds from the monthly direct payments on behalf of the Commission? Why has the EU delegation of the West Bank and Gaza Strip in Jerusalem not been put in charge of this control?
8. Is it correct that the profits gained through the monopolies on tobacco and crude oil controlled by the PA have been so far directly transferred to president Arafat? Do these monopolies still exist? What is the role of the current Minister of Finance Fayad in the control and administration of these funds? Is there a cooperation between the EU and the “Coalition for Accountability and Integrity” (AMAN), which was founded by a Palestinian civil anticorruption organization and counts with the support of Transparency International?
9. Is it true that you said that since the budgetary aid was not bound to concrete projects it was not possible to control its use? Is it correct that officials of the Commission have stated that the commission could not actually know what was being financed with this aid and that the real problem was not what appeared in the budget of the PA but rather what was missing there? If so: Do they believe that given the serious allegations such a statement can seriously serve as a basis for the maintenance of the monthly lump sum payments?
10. You underlined several times that there were no proofs of the fact that European funds have been being used for means other than those agreed and that thus the monthly payments should be continued. Do you believe that by expressing before the Parliament that the clarification of the matter interested you as much as “a hole in your head” your willingness to clarify this issue is put at evidence?
I would be very grateful, if you could answer these questions before the next session of the European Parliament in Strasbourg in 2003.
Yours sincerely Armin Laschet MEP
Nedenstående er svar fra Chris Patten til Armin Laschet, medlem af Europa-parlamentet :
THE RIGHT HONOURABLECHRISTOPHER PATTEN, CH. MEMBER OF THE EUROPEAN COMMISSION, Rue de la Loi 200, 1049 BruxellesWetstraat 200, 1049 Brussel
Brussels, 21 January 2003
Dear Mr Laschet,
Thank you for your letter of 16 December 2002 concerning EU funding to the Palestinian Authority. I apologise for the lateness of my reply which is unfortunately the result of mail delays over the Christmas break.
As Commissioner responsible for a large proportion of the European Community’s external assistance package, I am acutely aware of the risks of misuse of EU funds and I have taken most seriously the allegations of misuse within the Palestinian Authority which have appeared in recent months.
Several members of the European Parliament have expressed concerns about our funding activities, and it is for this reason that I have instructed my services to provide whatever clarification is required to the European Parliament. I regret that this may have been perceived as interference. It was my sincere understanding that these meetings were, on the whole, well received by MEPs, and indeed it was on the basis of this information exchange that the European Parliament was able to approve additional funding of over €50 million from the Emergency Reserve in November last year. It is in this same vein that detailed responses have been prepared in response to your questions, which I enclose with this letter.
Let me make one thing very clear: the European Commission will never accept EU funds being diverted into the hands of terrorists. Claims that the Commission continuously refuses to investigate misuse allegations cannot be further from the truth. The Commission has examined all documents which have been made available to us by the Israeli authorities. To date we have found no evidence that EU monies have been misused by the Palestinian Authority in order to finance terrorist activities, or for anything other than their agreed purpose. There is however no room for complacency. We have followed up specific points with the Palestinian Authority and will continue to examine any possible further allegations as a matter of utmost priority.
We remain convinced, as does the European Council, that deepening the reform in the PA and improving its financial management and audit capacities is the best preventive strategy against possible misuse of funds and corruption in the PA. The reform of the financial management of the PA is a core objective of several key conditions attached to the EU budgetary support. The success of this work, which has been overseen by the EU with very useful assistance from the IMF, has been acknowledged by the European Council and the international community as the most substantial progress in the Palestinian reform efforts. As you know, at the end of 2002 Israel partially resumed the tax transfer payments using the same monitoring mechanisms as ours. We hope that they will continue to pay regularly allowing us to return gradually to traditional financing mechanisms in our co-operation with Palestine.
I hope that the enclosed information addresses fully the number of concerns that you have raised in your letter. Should you have any further questions, please to not hesitate to contact me or my staff. I would be happy to repeat the exercise we had at the end of last year of an information meeting for the AFET, Cobu and CoCoBu committees in order to go into any further details that Members wish. In this regard, we will only be too willing to work closely with any joint working group of these committees that might be created following today’s debate in COBU on the working document drafted by Mr Garriga. I have given instructions to that effect to my services.
Taking these new developments into account, I will take this opportunity to send a copy of this letter and its attachment to the president of Parliament, the Presidents of all political groups and the chairmen of the three Committees concerned.
ENCLOSED INFORMATION :
1. Is it true that only 55 to 66 percent of the amounts allegedly needed by the Palestinian authority for wages are actually paid as such? How, or through whom, does the Commission check what amounts are needed for wages and what amounts are actually used for wages?
No, it is not accurate that only 55 to 66 percent of the amounts allegedly needed by the Palestinian Authority for wages are actually paid as such.
The emergency spending plan elaborated by the Palestinian Authority with the assistance by the IMF for the year 2002 foresees monthly current expenditures of a maximum of US $ 90 million, with a maximum amount of US $ 58 million for wages.
During the course of the year 2002 (January till October), wages (on a planned basis) amounted to an average of US $ 56 million. On the basis of cash paid, the average amount for wages was US $ 52 million for the same period. The gap between commitments and cash payments reflect wage arrears, which resulted because budget revenues during the above mentioned period (PA own revenues and external aid) were not sufficient to cover 100 % of the wage bill of the PA.
Monitoring of commitments and actual payments is carried out by the IMF in the framework of its overall monitoring of the macroeconomic implementation of the PA budget. The IMF provides the respective figures to the Commission in monthly comfort letters.
2. How many people/officials are employed by the PA (exact figure)? Does the number of those actually employed correspond to the figure given in the budget plan of the PA? Are these figures checked and, if so, how and by whom? What pattern has been observed since the first payment of EU budget aid in June 2001.
By end-October 2002, the exact figure of PA employment reached 124609. The emergency spending plan agreed with the PA and the IMF for 2002 foresees a ceiling of maximum 125,600 employees. Therefore, employment by end-October 2002 stayed within the limits foreseen in the emergency spending plan.
These figures are collected monthly by the payroll unit of the Ministry of Finance, which, as one of the conditions for the EC budgetary support, has been brought fully under the control of the ministry. The figures are checked by the internal auditors of the Finance Ministry, which have been deployed in the line ministries, and which are to receive additional training provided through the EC in co-operation with USAID. In addition, the figures on total employment and net recruitment are monitored by the IMF in the framework of its overall monitoring of macroeconomic implementation of the PA budget – and the IMF provides the respective figures to the Commission in monthly comfort letters. This has been further tightened through the Commission receiving, since August 2002, a monthly breakdown of PA employment by Ministry and Agency.
From June 2001 to December 2001, the number of PA employees rose from 118,762 to 122,101, a net increase of 3,339. For the whole year 2001, the increase was 7,200. Since such an increase was deemed to be unreasonable in times of fiscal crisis, the EU budget support in 2002 was conditioned on a recruitment freeze, except for the sectors of health, education and the judiciary. As a result, PA employment only rose to 124,609 by October 2002, an increase of 2,508, which if sustained, would reduce the 2002 annual growth of the payroll down to some 2% from previously 6% in 2001, and 15% in 2000.
Do you consider it inconceivable that the PA maintains an unofficial shadow budget without the Commission’s knowledge based on a system of double bookkeeping?
The Palestinian Authority’s budgetary system requires that all revenues and expenditures are channelled through the Ministry of Finance’s Single Treasury Account at the Arab Bank in Gaza, including payments made by Israel, the EU and other international donnors. All revenues and expenditures are reflected in the overall PA budget. The IMF continuously monitors the implementation of this budget. It is therefore virtually impossible that the PA could maintain an unofficial shadow budget based on a system of double bookkeeping, and the Commission has no evidence to support claims to that effect.
3. Is it true that an obligatory “Al Fatah membership” levy of 1.5 to 2% is applied to the wages paid by the EU for the employees of the PA? If not, how can the Commission check this? Is it true that the Commission said that this “membership contribution” can be compared to contributions made to chambers of labour as in the Saarland or Bremen or the Scandinavian or British trade unions? If so, then do you agree with this assertion or consider this to be a valid comparison?
According to information provided by the IMF, the Al Fatah membership levy is paid exclusively by Fatah members. . Given the fungible nature of general EU budgetary support it is not possible to link any salary payment directly to the EU funds. In any event, it is inconceivable that the Commission intervenes on an individual’s decision on how to spend his salary.
In a response to similar questions by the German magazine DIE ZEIT, the Commission only noted that “this system is not dissimilar” to deductions for trade union members’ fees in some EU countries”. The point of similarity is strictly and solely in relation to the mechanism. Clearly we have not compared Fatah as an organisation with any European trade unions.
4. Does the EU transfer the € 10 million every month in Euro and then have the amount converted into shekels by the bank or is the conversion work carried out by the PA? Which body oversees this exchange transaction for the EU? Is it true that, before the introduction of the Euro as a means of payment in 2002, the transactions were carried out in US dollars and exchange rate speculation was still possible?
The € 10 million, which the EU transfers to the PA on a monthly basis, are transferred to the Shekel Single Treasury Account of the Ministry of Finance at the Arab bank in Gaza. This account is used by all donors as well as by Israel for the transfer of tax payments. The Arab Bank converts the funds upon their arrival immediately into shekels at the market exchange rate. The monitoring of the transactions on the Single Treasury Account, in particular on the incoming payments of the EU is being carried out by the IMF within its general monitoring mandate.
EU transfers have never been carried out in US$, even before the introduction of the Euro as a general means of payment. The monthly payments were always carried out in Euro using the above mentioned conversion mechanism. This mechanism excludes the possibility that the EU funds could be used for exchange rate speculation or that funds could have been diverted by the means of exchange rate speculation.
6. Can you confirm that those suspected of the murder of Techiya Bloomberg (Farid Azouni and Samar Abu Hania) and the person presumed to be behind the Barmitzvah outrage (Nasser Awis) are on the payrolls of the Palestinian Autonomous Authority? Are you aware of any other alleged terrorists, who, being officials of the Palestinian Autonomous Authority, draw their salaries from the direct budgetary aid from the EU? How does the Commission check who is on the PA payroll and what means does it have of influencing the payrolls?
None of the documents provided by the Government of Israel has shown any indication or proof that the above mentioned persons or any known members of terrorist groups are on the PA payroll. The Commission has followed up this question with the PA, including the head of the Preventive Security forces in the West Bank. He informed us that Awis was a member of the security forces before the intifada, then stopped reporting to his post before the attacks he is accused of took place. According to the Preventive Security chief, Azouni and Abu Hania are not on the PA payroll.
International donors cannot check each and every one of the 124,609 names on the PA payroll – but we have consistently pressured the PA to bring the payroll administration under full control of the Finance Ministry. This was agreed in August 2001. With the internal auditors Fayyad has dispatched to the different administrations and the introduction of direct salary deposits, he is now in a position to fully control the PA payroll. Furthermore, the IMF monitors the development of the payroll in each PA administration in the framework of its overall monitoring of macroeconomic implementation of the budget.
It should be stressed, however, no administration in the world can ever exclude outright the possibility of one of its public servants secretly joining radical or even terrorist organisations. Once again the best way to minimise the risk of this happening is to continue to pursue comprehensive reform of the Palestinian Authority, including its security services.
We would like to reiterate what has been mentioned in the answer to question number 4 on the nature of budgetary aid. EU budgetary aid as well as all other PA revenues, other donor’s budgetary aid and Israeli transfer payments are paid to the same Single Treasury Account. Expenses of the PA are paid using the same account. The EU and other contributors do not finance any specific salaries, but participate in the financing of the PA budget.
7. The Commission has on several occasions given assurances that the ex post checks on EU monthly direct aid by the IMF are satisfactory. Senior IMF officials, e.g. Thomas C. Dawson, admit however that the IMF supplies the EU only with information on general developments connected with the budget but has no mandate to check every individual budget item and thus the actual use of the money. Do you really believe that the so-called monitoring of budgetary implementation by the IMF is sufficient given the gravity and number of accusations? What institutions other than the IMF check and monitor the use of resources from the monthly direct payments on behalf of the Commission? Why is the EU Delegation for the Palestinian Autonomous Regions in Jerusalem not given responsibility for such control?
The role of the IMF in our budgetary support package has caused concern among several MEPs and despite our best efforts to provide clarifications, there continues to be a number of misunderstandings.
The IMF reports to the European Commission on a monthly basis in great detail, including the compliance of PA with EU conditions on financial transparency, judicial reform, etc.
The IMF has expressed itself in detail about its role in a written presentation to EU Member States in February 2002 and to international donors at the latest donor meeting (Ad Hoc Liaison Committee) in Oslo on 25 April 2002. These papers, which I enclose, have already been made available to the European Parliament.
We shall not repeat what we have already stated on numerous occasions about the IMF role. Rather, we enclose the most recent correspondence with the IMF on this matter which is a letter from November 2002 in response to a question from Deputy Ilka Schröder’s office. As you can see, this letter sets out in extremely clear terms the extent of IMF activities in the context of EU budgetary support, including monitoring, and the evolution of the role of the IMF from 2000 to date.
I sincerely hope that the enclosed information will finally clear up any confusion that might remain.
8. Is it true that that the profits derived from the PA-controlled tobacco and crude oil monopolies have to date been channelled direct to President Arafat? Do these monopolies still exist? What role is played by the present finance minister Fayad in the control and management of these resources? Does cooperation take place between the EU and the reform initiatives prompted by leading Palestinian figures in collaboration with Transparency International?
The tobacco and crude oil monopolies as well as other PA monopolies and commercial investments, for example the 100% PA-owned cement company or the 30% PA-share in the Jericho Casino – which according to recent Israeli press reports may have also involved Israeli interests- are grouped under the Palestinian Commercial Service Company, which holds PA commercial investments. Profits accrue to the holding company or its subsidiaries. These investments were audited on request of the donor community in February 2000 by Deloitte Touche Tohmatsu International, and the audit report was presented to donors and the IMF in May 2000. It was precisely the European Commission who made the transfer of all these off-budget assets to a publicly-controlled Palestinian Investment Fund a condition of its budgetary aid operations. In response, the new Palestinian Finance Minister, Salam Fayyad, has established the Palestinian Investment Fund in September 2002, and an audit of all PA commercial investments is being carried out by Standard & Poor’s. The audit report should be completed by mid-February 2003 and published thereafter by the Finance Minister. The identified assets will then all be transferred to the new public investment fund under control of the Finance Minister. In the meantime, the Finance Minister already controls the profits of the Palestinian Petroleum Corporation, which are being transferred to the Single Treasury Account since July 2002 at a rate of approximately US$ 1 million a month.
The draft budget for 2003 submitted to the Palestinian Legislative Council end-December 2002 foresees for the first time revenues of NIS 150 million (US$ 30 million) coming from the Palestinian Investment Fund.
As regards co-operation between the EU and reform initiatives prompted by leading Palestinian figures, the European Commission is in regular contact and dialogue with AMAN – the coalition for accountability and integrity, the Palestinian chapter of Transparency International, and composed of six major Palestinian NGOs. The results of these contacts, such as AMAN’s Palestinian National Action Plan Against Corruption, are regularly fed into the Commission’s policy vis-à-vis the PA. The European Commission is, furthermore, in regular contact with leading reform-minded Palestinian figures.
9. Is it true that you have said that the direct subsidies to the PA are not actually earmarked for specific purposes and therefore do not lend themselves to monitoring? Is it true that Commission officials have said that the Commission could not really know what exactly it was financing with its assistance and that the real problem concerned not so much what was as what was not in the PA’s budget? If so, do you think that, in view of the seriousness of the accusation, an assessment of this type can serve as a basis for continuing the monthly flat-rate payments?
Direct budgetary aid is a financial contribution that accrues to the PA budget like other PA revenue, other donor budget support and tax transfers from the Israeli government. By definition, funds provided in support of the general budget of any country receiving such funds are not attributed to any specific expenditure or transaction but serve to finance public expenditures as included in the budget. Public expenditure controls for the entire budget are executed via the internal and external control systems of each country. This is also the case for the PA, and the EU – via the conditions attached to the budgetary aid operations – has successfully been exerting pressure for a reinforcement of these control functions.
While the Finance Minister has substantially increased the number of internal auditors in line ministries, the Commission has equally succeeded in initiating a review of the mandate of the PA’s Auditor-General to ensure that the annual external audit will be comprehensive, independent, and available to the Palestinian Legislative Council.
It should also be noted that the strengthening of the Finance Ministry’s internal audit (or financial control) functions, including pre- and post-payment audits in real time, will be supported by EU trainers in co-operation with USAID. In this context, a mission consisting of EU officials and professional experts will discuss with the PA, starting this week, the details of the respective aid package which will concern the training of around 200 auditors.
10. On several occasions you have stressed the absence of any proof that European assistance was used otherwise than agreed and that the monthly payments therefore had to be continued. Do you think that your willingness to clarify matters is demonstrated by telling the European Parliament that you want the issue investigated “like you want a hole in the head”?
My words have been totally ripped out of context to imply that the Commission has refused and continues to refuse to investigate allegations of misuse of EU funds. What I actually said on 21 October was that [the notion that the proposal to set up a Committee of inquiry was somehow helpful to me and to the cause of humanitarian relief in Palestine and to finding a political accommodation to save us from this blood feud was as far from reality as it is possible to go]. What I was seeking to underline was that it would not be appropriate to cast doubt on our actions in the Middle East at a moment when the EU together with the Quartet have become the main actors able to broker peace in the region, in particular thanks to its actions and aid packages delivered during the last years. As I have already said, the Commission has, on the basis of its examination of documents which have been made available, concluded that there is, to date, no evidence to support claims that EU monies are being used to fund terrorism. I have instructed my officials to provide all information about our financial package to the European Parliament in full transparency. A first meeting of members of the Budget, Budgetary Control and Foreign Affairs Committees took place in November 2002. Commission services are ready to repeat this exercise at the wish of the European Parliament.
Our Direct Budgetary Aid has been motivated by the fact that Israel withholds Palestinian tax receipts amounting to approximately US$ 30 million/month. In this context, it was necessary to preserve the PA administrative structures and to enable it to deliver basic services, while at the same time using our assistance to promote reform and improved management. It is equally clear that once the Israeli authorities will resume the transfer payments on a stable and regular basis, the EU will seek to return gradually to more targeted forms of financial assistance.