Bezalel Smotrich
Bezalel SmotrichChaim Goldberg/Flash90

The Finance Ministry, under the instruction of Finance Minister Bezalel Smotrich (Religious Zionism), has found a solution to a decades-old problem which until now has prevented Israel from collecting the Palestinian Authority's (PA) debts to Israel Electric Corporation (IEC).

According to Israel Hayom, the new legal plan will for the first time allow Israel to collect the debts owed to the IEC for electricity provided in PA-controlled areas of Judea, Samaria, and Jerusalem.

Thus far, the Palestinian Authority has racked up a debt of two billion NIS.

During a meeting held three months ago in Smotrich's office, those present discussed the issue of the PA accruing a debt of tens of millions each month, while Israel has no legal way to deduct the funds from monies transferred to the PA.

Smotrich then instructed his office to solve the problem. At that point, it became clear that the "implementation" law legislated following the signing of the Oslo Accords allows Israel to deduct the PA's debts from the funds that it passes to the Palestinian Authority, among other things for the provision of electricity. Such a deduction requires the signature of the Finance Minister and may be done only for corporations which are under the direct control of the Palestinian Authority. However, the body purchasing the electricity from the IEC and providing it to PA Arabs in Judea, Samaria, and Jerusalem, is the Hami company, which has no direct connection to the PA.

However the Finance Ministry did find a direct connection between Hami and the PA, after it was proven that 19% of shareholders are local authorities in the PA (60% are PA Arab families with less than one percent of shares), and seven out of the 18 directorate members are members representing the municipal authorities in the PA. Thus, for the first time, the Finance Minister has signed an order to deduct the PA's electricity bill - through Hami.

Thus, every month, Smotrich is expected to sign off on the deduction of a sum between 20-30 million NIS, which will be transferred to the IEC.

The decision was coordinated with the Defense Ministry, Coordinator of Government Activities in the Territories (COGAT), and the National Security Council.