§ 3 p.m.
§ Baroness Williams of Crosbyasked Her Majesty's Government:
What steps are being taken by the European Union Council of Ministers to seek compensation for European Union-financed infrastructure destroyed by military action in the Palestinian territory.
§ Baroness AmosMy Lords, the damage to EU and other donor-funded projects caused by Israeli military actions was first discussed by EU Foreign Ministers at the General Affairs Council on 28th January. Following that meeting the EU demanded that this practice stop, and reserved the right to demand compensation in the appropriate fora. The European Commission continues to monitor and cost the damage arising from recent IDF operations.
§ Baroness Williams of CrosbyMy Lords, I have no interest whatever in laying blame but, according to the European Union Commission, the total value of the destruction of the civic infrastructure of Palestinian 993 territory was of the order of 19 million euros. Approximately two-thirds of that sum was provided by bilateral aid from individual EU member countries. The destruction included Gaza airport, the Palestinian Broadcasting Authority and at least five of the new civil police camps which have been established as a result of EU aid.
Does the Minister agree that, if we are to create a Palestinian state with the kind of infrastructure which will offer young Palestinians some hope that might lead them away from terrorism, it will be vital to replace that infrastructure? At a meeting of the so-called Oslo donors on 25th April, it was estimated that the cost of rebuilding the infrastructure would be at least 2 billion dollars, of which 800 million dollars still has to he found in this year alone. Does she consider it vital that, when the four-part conference meets next month, it considers how donors can be given proper guarantees that neither side will involve itself in the destruction of the infrastructure, which is so vital to the future of the Palestinian territory?
§ Baroness AmosMy Lords, I entirely agree with the noble Baroness, Lady Williams, that the recent incursions in the West Bank have caused extensive damage not only to the physical infrastructure but also to institutional capacity. A damage assessment is being conducted by the international agencies; a joint World Bank/L NESCO report is due to be circulated by 13th May; and follow-up action will then be discussed at a local aid co-ordination committee meeting later that week .The European Commission has pledged to lend its full support to the reconstruction of the destroyed infrastructure and the rebuilding of the Palestinian Authority. I agree with the noble Baroness that this will be an important part of the peace-building effort.
§ Lord Wright of RichmondMy Lords, on 23rd April 2002 (Hansard, col. 125) I asked the noble Baroness the Minister whether she would confirm that the British Government still regarded the Palestinian Authority, under its elected President, Yasser Arafat, as the legitimate administrator of the Occupied Territories. By what I fully accept was an oversight, the noble Baroness failed to answer my question. In the light of Prime Minister Sharon's reported attempts to exclude President Arafat from the peace process, and in the light of the regrettable statements reported as having been made by Mr Netanyahu in Trafalgar Square yesterday, comparing President Arafat with Hitler, Saddam Hussein and Osama bin Laden, may I now ask for a reply to my question?
§ Baroness AmosMy Lords, the answer is, yes, it is for the Palestinian people to chose their leader.
§ Lord Janner of BraunstoneMy Lords, when considering the question of financing the Palestinian Authority, can my noble friend tell the House how much of the finance that has been provided, by the European Union or otherwise, has provably been used for the purposes for which it was provided, and what 994 has happened to the rest? Furthermore, can she kindly tell us how much has been paid by the Saudis, the Iraqis and the Iranians to cover the cost of the intifada and the suicide bombing?
§ Baroness AmosMy Lords, the EC's humanitarian budgetary assistance for the Palestinian Authority is framed firmly within a number of conditions which are designed to ensure financial probity. These include keeping expenditure within a pre-agreed austerity budget, non-accumulation of arrears, consolidation of revenues under the Ministry of Finance and satisfactory proposals for reform. Those arrangements are closely monitored by the IMF and payments are transferred to the Palestinian Authority only after the IMF has verified that the money has been properly spent according to the agreed purpose. We have no reason to believe that there has been any misuse of EC money.
§ Lord Howell of GuildfordMy Lords, of course the civic infrastructure of a future Palestinian state must be rebuilt and we all recognise that. However, will the Minister accept that there have been some concerns in the past that the transfer of moneys from outside, in particular from the European Union, have not always ended up in the right place, and that there is evidence that some of it has gone to weapons rather than infrastructure and to terrorists rather than to the civic order? Will she assure us that for any future moneys to be transferred from the European Union, and I am sure that there should be, proper safeguards will be in place to ensure that the money goes into infrastructure and not into undesirable purposes?
§ Baroness AmosMy Lords, I think I made it clear in my previous reply when I mentioned the arrangements which have been made to monitor the European Commission's humanitarian budgetary assistance to the Palestinian Authority, that the money is well-monitored by the IMF and is transferred to the Palestinian Authority only after there has been verification that the money has been properly spent.
The IMF is satisfied with the accounts it has seen to date, but there is always room for improvement. The World Bank is planning to undertake a detailed assessment of the Palestinian Authority's financial management processes and systems with a view to designing ways of improving their transparency and their effectiveness. I hope that that review, and the outcome of that review, will reassure noble Lords.