Statistics and the Concerns of Funds in Palestine

● The annual financial and administrative report of the "Palestinian Alimony Fund" for 2018 showed the existence of an invested amount from the "Palestinian Alimony Fund" in the form of a loan to the "Palestinian General Petroleum Authority", at a Murabaha rate of 6%, and the report indicated that this loan is guaranteed by the Ministry of Finance... I followed up the Ministry of Finance statistical reports for June 2020 and the figures for the public debt of the Palestinian government in Table No. 7, where these statistical reports of the Ministry of Finance and Planning showed that the domestic public debt reached, at the end of 6-2020, the amount of 6,164 million shekels (six billion one hundred and sixty-four million shekels) equivalent to the amount of 1,787 million dollars (one billion seven hundred and eighty-seven million dollars). Of this domestic public debt, bank loans amounted to 3,766 million shekels, equivalent to 1,091 million dollars, and an amount of 1,312 million shekels as bank facilities, equivalent to 380 million dollars, in addition to short-term loan amounts to the "Palestinian General Petroleum Authority" which amounted to 1,312 million shekels (one billion three hundred and twelve million shekels), equivalent to 300 million dollars.., added to that, loans from other public institutions, which amounted to about 51 million shekels and equivalent to 15 million dollars; the source of these loans originates from the "Dar Al-Yateem Institution" and the "Palestinian Alimony Fund" as shown by the above-mentioned Ministry of Finance statistics, and these loans granted to the "Palestinian General Petroleum Authority" as well...

● I reviewed the annual report of the Palestinian Alimony Fund for 2018, which is the latest issued and available report, and which is considered one of the necessary funds in Palestine to economically empower women, children and families who obtained alimony judgments from Sharia courts due to divorce, to spare them poverty and need, and to enable them to continue their life paths...with dignity.., and in order to audit the financial status of the Palestinian Alimony Fund and its ability to lend to Palestinian government institutions, I present the following general and financial descriptive summary of this fund:

● The fund was established in 2005 pursuant to the Alimony Fund Law No. 6 of 2005, by virtue of Decree-Law No. 12 of 2015 amending the basic Alimony Fund law. Its general purpose is to pay all alimony judgments issued by the competent authorities to their beneficiaries... and to improve the quality of services provided by the fund, recover amounts paid, and ensure the fund’s sustainability..

● The number of beneficiaries entitled to alimony in 2018 reached 11,869 individuals, where the number of child beneficiaries was 9,211 children, and the number of female beneficiaries was 1,549 women. The average monthly disbursement for children was 350 shekels, and the average monthly alimony payment for women was 480 shekels. Disbursements to beneficiaries that year — 2018 — totaled 3,975,090 shekels, a decrease from 2017 of 300,458 shekels. While the fund’s expenditures in 2016 amounted to 3,392,689 shekels, there is an increase in 2018 expenditures over 2016 by 2,569,704 shekels. Disbursements during 2018 covered entitlements for 12 months for 2018, 17 months for 2017, and 10 months for 2015...

● The fund relies primarily, according to the founding law and the amending Decree-Law, on the fund’s main financial resources derived from marriage contract fees and divorce documents at a rate of 61%, which contributed during 2018 the amount of 4,462,216 shekels, compared to 5,963,454 shekels in 2017, i.e., a decrease from 2017 of 1,501,238 shekels. Investment profit revenues amounted to 46,962 shekels at a rate of 1%, from public donations 13,000 shekels, from fine revenues 406,848 shekels at a rate of 5%, and from birth certificate fees 2,390,340 shekels, i.e., 33%, so that the total amount roughly equals 7,321,924 shekels.

● As for investment revenue, the investment agreement with the General Petroleum Authority was renewed for the amount of 1,500,000 shekels in return for a Murabaha rate of 6% annually... the loan is guaranteed by the Ministry of Finance as shown by the annual report... and the loan was renewed during 2018. The investment revenue decreased due to non-renewal of the investment during 2017, for which the reason for not renewing the loan agreement with the General Petroleum Authority in 2017 was not clarified. It is noteworthy that the loan to the Authority was 4 million shekels, according to my review of earlier statistics, despite the fact that the loan as shown in the fund’s 2018 annual report appeared as the amount 1,500,000 shekels, and Ministry of Finance statements up to June 2020 did not show separate amounts of loans from public institutions such as Dar Al-Yateem and the Palestinian Alimony Fund individually; moreover, no repayments by the General Petroleum Authority of its loans from these public institutions appeared in its statistical reports in 2017..

● The 2018 annual report indicates that as a result of floating the exchange value of the dinar in the Sharia courts, revenues from marriage contracts and the volume of divorce declined compared to 2017... General expenses in the same year — 2018 — amounted to 2,231,025 shekels, representing 30% of revenues, whereas in 2017 expenses amounted to 1,844,399 shekels. Despite an increase in court revenues of 182,216 shekels, the annual donations allocated by law from the Palestinian National Authority in the amount of 400,000 shekels were not transferred, which demonstrates that the government did not transfer the fund’s share from the general budget and the reasons are unknown....!! In addition, investment revenue decreased by 193,037 shekels, and fine revenue decreased by 113,151 shekels..

● Regarding obligations due to beneficiaries and unpaid, the fund still owes them an amount close to 2 million shekels for entitlements for 10 months from 2015-2016. As for beneficiaries’ receivables in 2018, they amounted to 17,671,642 shekels, while beneficiaries’ receivables in 2017 amounted to 13,766,979 shekels. These accumulated debts to beneficiaries... the fund will schedule them over the coming three years and a quarter, giving priority to regular monthly transfers, and the monthly debts will be disbursed according to available cash liquidity at the fund, committing to disbursing entitlements of four months during each year from the accumulated entitlements, up to an amount of one million shekels, in order to ensure the fund does not fall into a liquidity crisis...

● As for the fund’s sustainability and governance, an amount of 777,674 shekels was recovered from those judged against, representing 19.43% of the amount disbursed during the year, and 5.4% relative to the receivables balance at year-end.. as recoveries of judgments that could not be executed by the competent execution departments according to the law, and based on settlement arrangements from those judged to pay...

● The number of enforcement files in the fund for 2018 was 649 files; 13.7% of the enforcement files were collected, noting that 47% of those judged reside outside the homeland... or outside the area of jurisdiction. 469 arrest orders were issued, only 64 arrest orders were executed. This indicates the difficulty of enforcing arrest orders, which clearly reduces the fund’s revenues.. in addition to a decrease in investment revenue by 193,037 shekels; additionally, the decline in revenue is also due to floating the exchange rate of the Jordanian dinar in the Sharia courts.

● The annual report showed that the number of people who inquired about the fund during 2018 on the social networking site – Facebook – reached 72 individuals... only.. which means interaction with the fund remains low-level...

● It is known that the State Audit and Administrative Control Bureau (SAACB) in its 2017 annual report indicated that there are many observations and administrative violations in the Palestinian Alimony Fund. Its summary of the main points in the aforementioned report related to the Alimony Fund in the governance sector (civil and security) indicated that the most important audit findings in this sector were as follows:

● The number of female beneficiaries from the Alimony Fund is very small if compared with the number of divorced women; their number by the end of 2016 reached about 428 files distributed across all governorates, where there is no public awareness of the Alimony Fund’s work, and no workshops are held to introduce its objectives. (It was noted in the fund’s 2018 annual report that workshops and seminars were held in 2018, and thus this appeared to be a response to the aforementioned SAACB reports). Also, there is no electronic linkage between the Sharia courts and the Alimony Fund regarding cases in which alimony judgments are issued.

● The percentage of those not committed to paying the amounts due to the Alimony Fund during 2016 was about 73%, which is a large percentage compared to the number of female beneficiaries of the fund, despite the fund taking several measures against those judged to pay. However, there is weakness in recovering amounts paid to beneficiaries from the fund, where arrest orders were issued for 13% of the non-compliant.

●      There are amounts owed to the female beneficiaries of the Alimony Fund, in the amount of approximately 4,250,000 shekels until the end of 2016... this contradicts the Fund’s main purpose of being established, which is to economically empower the beneficiaries and spare them the specter of need and poverty... noting that the accumulated amount had jumped significantly in the annual report for 2018, and reached 17,408,386 shekels, becoming a large debt obligation on the Fund, which will fully affect the Fund’s services, and will significantly slow the development of its services.

●      As for the administrative regulations of the Alimony Fund, a special administrative regulation for it was adopted by the Board of Directors, without being presented to the Cabinet for issuance in accordance with the proper procedures and the law. A salary scale was also adopted that differs from the salary scale set forth in the amended Civil Service Law No. 4 – for the year 2005. It is clear that salary expenses for 2018, as stated in the Fund’s annual report, were the largest proportion of expenses, amounting to 1,336,712 shekels, while salaries in 2017 amounted to 1,209,430 shekels...

●      The Fund’s 2018 annual report also showed that the Board of Directors is attempting to develop the administrative structure, which could be adopted in 2019 — according to the report — noting that this is a violation of the Civil Service Law, under which the appointment and dismissal of employees are subject to the Civil Service Law. In addition, the Cabinet, to which the Fund is attached, is the authorized body for such powers, not the Fund’s Board of Directors. It is apparent that the Fund’s annual expenses for 2018 were burdened by the largest proportion, namely employee salaries...

●      The financial and administrative conditions of the Palestinian Alimony Fund, as shown by the official statistics, do not correspond to the objectives for which it was established, in addition to the administrative violations and the inability of the Fund’s Board of Directors to reduce expenses, and to develop revenues and investments... in a better manner. Adding to this the accumulation of beneficiaries’ dues to this degree of seriousness, as well as the failure to adhere to an administrative structure compatible with the Civil Service Law and in accordance with the law establishing the Fund, which has burdened the Fund with expenses most of which are employee salaries. The government should be urged to remit its share of aid from the annual general budget, approved under the law establishing the Fund. Procedures for collecting amounts adjudicated by the Sharia courts should be activated to protect beneficiaries under those rulings, and the administrative structure should be changed in a manner consistent with the Palestinian Civil Service Law so that the sustainability of this Fund can be preserved and fair investment undertaken according to capacities and capabilities, and the services of the Alimony Fund expanded to include all entitled persons in a way that serves Palestinian society and preserves family dignity ..

●      6-9-2020