Prime Minister Ehud Olmert has drafted a proposal to help support the new Palestinian Authority emergency government, headed by Salam Fayyad, which includes formal recognition, as well the release of hundreds of millions of dollars in funds. The cabinet will vote on the proposals at its weekly meeting, Sunday.
According to the proposal, "given the developments on the Palestinian side, the disbanding of the unity government and the creation of an emergency government, Israel
will continue to work with Palestinian President Mahmoud Abbas and return to work with the Palestinian government, with its recognition based on Quartet preconditions (recognition of Israel, renunciation of violence and acknowledgement of previous agreements between Israel and the Palestinians).
"In this context, Israel will renew the transfer of tax revenues - in accordance to agreements between Israel and the PLO, which are currently held in Israel. The dates and method will be coordinated with the emergency government.
"Likewise, Israel will continue to give all the humanitarian assistance it can to the Palestinian population in Gaza. Concurrently, in line with previous government decisions from February 19 and April 11, 2006, it will not have contact with Hamas sources."
Olmert's proposal would effectively transfer $400 million,
currently frozen in Israel. The prime minister said he would make sure the funds would go only to the Fatah government on not to terror organizations or other groups hostile to Israel.
The proposal emphasizes the need for the Israeli government to "use a fitting policy to deal with the emergency government and apply previous government decisions to the new reality.
"The purpose of previous government decisions (in early 2006) was to prevent contact with the Hamas government. In order not to strengthen the organization, it was decided to withhold Palestinian tax revenues from Hamas. Today, there is room for a change in this policy."
Israel is expected to release withheld tax funds to the Palestinian Authority just in time for a four-way Middle East summit in Sharm el-Sheikh
on Monday.
Foreign Minister Tzipi Livni (Kadima) and Defense Minister Ehud Barak (Labor) support the proposal, which is expected to pass during Sunday's meeting, despite criticism from certain cabinet members such as Minister of Strategic Affairs Avigdor Lieberman (Yisrael Beiteinu).
"It's already been proven that the transfer of funds and weapons to Fatah is used to aid terror, not fight it. Even if we give Abbas F-16s, he has no chance to succeed," Lieberman said.
Vice Premier Eli Yishia, of Shas, disagreed with him. "Considering that the transfer of funds is meant to strengthen Abbas and not a government with Hamas elements, we will support the Prime Minister's proposal.
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