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Israeli government spent NIS 1.1 billion on settlements in 2011

Netanyahu increases settlement spending by 38%, $10 billion spent over the past 20 years

Richard Silverstein's blog            30 July 2012       in MIDEAST PEACE

settlement construction

New Israeli settlement construction just outside Jerusalem

The Israeli business publication Calcalist broke a major new story (Hebrew) about a government report which recounts Israeli spending over the Green Line.  The document, prepared for the U.S. government (which deducts from foreign aid expenditures monies spent by Israel on settlements), has so far been kept a secret (though Haaretz has just published its own short summary in English).  That’s because it’s highly damaging to the government’s contention that the settlements and Israeli investments in them are not the obstacle to peace that the Palestinians and peace activists say they are.

In 2010, the Netanyahu government increased settlement spending by 38% over the year before.  The overall budget grew by only 2.5% during that year.  Per capita spending there is higher than the relative number of residents in the Territories (compared to those living within the Green Line) by 80%.  Netanyahu invested $250-million on Jewish settlement in that period and $2.5 billion overall from 2003 to 2011.  From 1992 to 2001, the government spent a total of $7-billion on settlements.

Shir Hever, Israel’s premier economist of the Occupation, who does his research for the Alternative Information Center, filled in for me what the survey omits, which is an eye-opener:

  1. It doesn’t include East Jerusalem, where almost half of the colonists live (the ICBS considers it part of Israel).
  2. It doesn’t include interest and inflation for the accumulation of subsidies for the colonies over the years.
  3. It doesn’t include the security costs – including the prison system for Palestinian prisoners, the military court system, the Wall of Separation, the Border Police and of course the military presence in the colonies itself. In my estimates, security costs are about twice as high as the civilian subsidies.

Also, there are other forms of support which are harder to measure. For example, the Ministry of Housing offers better mortgage benefits in the colonies. The colonists still take out a loan to buy a house, but they pay a lower interest. The economic significance is very large, but it isn’t budgeted in the Ministry of Housing and therefore not reported by the ICBS.

When confronted with these numbers the settler leadership actually has the chutzpah to claim that these are not investments solely benefiting Jews, but rather spending that will improve the chances for “co-existence.”  They actually have the temerity to claim that the spending, which benefits Jewish settlers exclusively, benefits the Palestinians as well, since it includes shared water and power lines, and roads (yes, you heard me, roads…that apartheid infrastructure that Palestinians may not step foot on).

The government’s response too was instructive.  It said the claims in the Calcalist report were “entirely without foundation.”  How do they manage such a statement?  Are the numbers wrong?  Are there other considerations the report doesn’t take into account?  We’ll never find out since the spokesperson didn’t even bother to support the claim with facts or evidence.

This is all happening against a backdrop of Israeli budgetary retrenchment, which anticipates increased taxes to pay for higher military spending and a potential military confrontation with either Iran or Syria (or both).  It’s embarrassing to realize that the government will be taking money from its citizens within the Green Line and transferring it to an exceedingly small number of citizens (around 10%) living over the Green Line.


Israeli government spent NIS 1.1 billion on settlements in 2011, reports show

Spending last year represented a 38% increase over funds allocated in 2010, but is significantly lower than the peak of NIS 2.5 billion in 1993.

By Chaim Levinson Jul.31, 2012 | 1:52 AM  15
Construction in the new Migron settlement outpost
Construction in the area where the Migron settlement outpost will be moved to.                                                    Photo by Emil Salman

The government spent NIS 1.1 billion on West Bank settlements last year, and could save at least that much if it were to make its spending proportionate to the number of Israelis who live in the settlements, according to two different reports made public this week.

Last year's government spending on the settlements represents a 38 percent rise over that of 2010. But it is significantly lower than the peak of NIS 2.5 billion (in real terms ) in 1993, when the funds were geared toward infrastructure changes required by the Oslo Accords, according to Central Bureau of Statistics findings reported on Monday by Israeli business newspaper Calcalist.

The report was prepared for U.S. officials to enable them to deduct the annual settlement expenditure from U.S. loan guarantees to Israel. In 2003 Israel stopped granting tax breaks to citizens seeking to move to the West Bank, after pledging to the United States that it would bring the benefits to an end.

In the second report, which also examines the cost of the settlements and is scheduled to be released to the public on Wednesday, Peace Now states that Israel could save NIS 1.6 billion a year if it were to match the level of government expenditure on services such as education and infrastructure in the settlements with the number of people who live there.

"If the government would just make per capita spending for residents of the settlements equal to spending for the rest of the country's citizens, we would be able to cancel the widespread [budget] cuts and significantly reduce tax increases," said Peace Now head Yariv Oppenheimer.