Evaluating the PNA's FY 2014 Budget and Identifying Changes Made to Fiscal Policies in the PNA's FY 2015 Budget- Roundtable (2)

The PNA's budget process begins when the government formulates the general budget and submits a request of approval to the Legislative Council, which was created in 1996 following the general elections. The Basic Law (which was passed in 2000 and provided – in Articles 60 and 61 – for the specific rules governing the preparation and approval of the general budget) and the General Budget Control and Financial Affairs Law No. 7 of 1998 defined the powers and responsibilities regarding the preparation, adoption and appropriation of resources in the PNA budget. The public commitment to the provisions of the law improved gradually, especially after 2003. However, since the internal mid-2007 divide and the resulting suspended parliamentary work, it is the legally entitled PNA President who approves the government budget.

The FY 2015 budget has been drafted within a high degree of uncertainty in the local, regional and international political and economic context, which is believed to have unfavorably impacted the economic and financial conditions in the Palestinian Territory. The peace talks between the Palestinians and the Israelis came to a halt; the PNA solicited a UN Security Council Resolution calling for the establishment of a Palestinian state on the 1967 territory, joined a number of international organizations, and signed several international conventions; the Government of Israel vengefully withheld clearance revenues in early 2015; some donors suspended, reduced, or delayed financial aid to the PNA; and John Kerry's initiative to assist the Palestinian economy was suspended given the stalled political path. At home, only a few weeks into the formation of a Palestinian consensus government, Israel waged a war on the Gaza Strip, inflicting heavy losses to the infrastructure and productivity, which worsened the already worsening socio-economic situation, thus redoubling the burden on the PNA. Meanwhile, Gaza reconstruction efforts came to a deadlock as the Government of National Unity was not allowed to take full charge, donors failed to pay the amounts they pledged in the October Cairo Conference, and Israel continued to deny the entry of reconstruction material.