State Comptroller's Report |

Israel Losing Millions to Settlers Who Don't Pay Land Leasing Fees, State Comptroller Finds

State comptroller's report urges Civil Administration, Israel Lands Administration and Finance Ministry to collect leasing fees.

Chaim Levinson
Chaim Levinson
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Chaim Levinson
Chaim Levinson

Residents of 83 settlements in the West Bank do not pay an estimated NIS 50 million per year in leasing fees on the property afforded them by the state, the State Comptroller's report reveals. The report cites negligence on the part of the Civil Administration and the Finance Ministry, adding that the financial loss to the state has totaled hundreds of millions of shekels.

The West Bank contains some 1.4 million dunams of "state-owned" land, which are administered by Yossi Segal, the official in charge of government and abandoned property in the territory. Of that land, 450,000 dunams have been allocated to two types of Jewish settlements in the West Bank: municipal settlements (towns and local councils run by the Housing Ministry) and rural settlements.

The comptroller's investigation revealed that residents of municipal settlements are required to sign contracts with the Civil Administration and pay fees to lease the land; however, the same protocol is not enforced with residents of the rural settlements, which translates into a cumulative loss of hundreds of millions of shekels. Furthermore, according to the report, senior officials have been aware of this lapse for years.

In 2005, Segal noted that he lacked the manpower to collect the leasing fees and that he needed 38 staffers to do so. In 2007 and 2008, discussions were held on the matter at the Finance Ministry, but no decision was reached. In August 2010, the Defense Ministry's legal adviser, Ahaz Ben-Ari, wrote a letter to then-Defense Minister Ehud Barak, saying that the system is defective and the failure to collect the leasing fees in the rural parts of the West Bank effectively provides land to settlers for free. He added that the lack of enforcement also favors rural settlers over others and deprives the treasury of revenues.

As a result, in April 2011 another discussion was conducted at the Finance Ministry's Budget Department, in which it was resolved that a collection unit should be established – which has yet to be created. In his report, State Comptroller Joseph Shapira wrote that the findings are "particularly grave," adding that, "this is a fundamental failure on the part of all the parties involved that has persisted for many years." He called on the heads of the Civil Administration, the Israel Lands Administration and the Finance Ministry's Budget Department to resolve this problem without delay. If they cannot reach an agreement, they must bring the matter to the chief of staff, defense minister, finance minister and, if necessary, to the prime minister.

The Finance Ministry responded that it "will review the issue of additional workforce for 2013 and on."

The Settlement Division wrote that "the director of the Israel Lands Administration and the head of the Civil Administration issued a directive that leases for new settlers should be drawn up by the Settlement Division. The contracts were to be signed by officials authorized by the administrator, and the fees were to be paid to the administration's account. This directive was not implemented due to reasons known only to the administrator."

The Coordinator of Government Activities in the Territories wrote that "this is a systemic failure, yet this result cannot be separated from the initial conduct of the Zionist Organization and the government's findings."

"In order to carry out regulation regarding leasing contracts, we are required to invest in resources and positions in order to provide the administrative capability to the authority responsible for state and abandoned property in Judea and Samaria. The matter was discussed many times with representatives of the treasury, but in practice no tools were given to the person in charge to implement this responsibility. There is no doubt that it is necessary to regulate this matter, as the State Comptroller notes. If the resources requested in the past by the Civil Administration and the Israel Lands Administration are provided, it will be possible to reach proper regulatory action for the matter."

COGAT also added: "Providing approvals to the Agriculture Ministry is done as a default, but because of the inability of the person in charge to issue leases on agricultural land, we are regretful to oppose the accepted practice, when in the end there is a direct contract between the farmer or the developer and the person in charge. Nonetheless, this solution is the best one for agriculture in Judea and Samaria in light of the existing situation. It must be emphasized that the permits are not given in a sweeping fashion but only after an in-depth examination of the status of the area, the existence of a general contract for the area, a proper request from an Agriculture Ministry representative, and an examination of all the data including an analysis in the field by the Civil Administration. It should also be noted that administrative efforts are underway to add the industrial area into the Shomron Regional Council's jurisdiction."

The Mitzpeh Kramim settlement outpost in the West Bank.Credit: Michal Fattal

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