Why don't The World Bank and IMF ever recommend the PA end Pay to Slay?

On May 10, the World Bank issued a report on the economy of the Palestinian territories, with suggestions and ideas to help it make ends meet.

This follows a similar report by the International Monetary Fund at the end of April. 

Both of them mention, as an issue, that Israel is withholding some tax revenue corresponding to the PA's payments to terrorist prisoners, their families, and families of "martyrs" - the so-called "Pay for Slay" program.

For example, the IMF notes:

A significant part of the fiscal problem is structural. The PA raises virtually no revenue from Gaza and East Jerusalem, while in 2021 it spent about a third of its budget in these two areas— particularly in Gaza—mainly comprising civil servant salaries and pensions, and net lending. Neither does it raise any significant revenue from Area C in the West Bank. Furthermore, the PA and Israel disagree on the amounts that the Government of Israel should transfer to the PA under the Paris Protocol, the so-called “fiscal leakages” (estimated at about 2 percent of GDP annually). In addition, the PA disagrees with unilateral Israeli deductions from clearance revenue for so-called “prisoner payments” (which amounted to 1.3 percent of GDP in 2021).

So while both groups mention the prisoner payments, neither of them suggest that the PA end the program.

They give plenty of other advice to the PA on how to reduce expenses and increase revenue. For example, the IMF recommends:

The way out of the current fiscal crisis will require wide-ranging Palestinian policy actions. Staff discussed the benefits of adopting a broad-based strategy to contain and rebalance public spending, while boosting growth. As the Palestinian authorities have fewer policy tools compared to peers, systematic reform to the key drivers of non-discretionary spending—i.e., civil service salaries and benefits, transfer payments, the public pension scheme, the health care system, and fuel subsidies—are key.    

But neither they nor the World Bank ever say that if the PA would just stop paying terrorist salaries, then a significant chunk of cash would immediately become available to them. 

Instead, they recommend negotiations with Israel on the topic, as if this is an expense that the PA has every right to spend even when they are being lent Western money.

It is telling that the world refuses to publicly condemn "pay for slay." And even those who are espousing responsible financial policies for the PA refuse to mention that lots of money can be saved if terrorists aren't rewarded for trying to murder Jews. 

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