Contribution to PEGASE in Support of the Palestinian Social Protection System ("Social Allowances") 2016

Contract partner: European Commission Country: Palästinensische Gebiete Funding amount: € 1.500.000,00 Project start: 01.10.2015 End: 31.12.2016

Short Description:

Overall goal

The overall objective of this temporary EU support is to maintain the viability of the

two-state solution by avoiding the fiscal collapse of the PA and sustaining basic

living conditions of the whole Palestinian population.

Expected results

The specific objective is to support the Palestinian national development agenda and

in particular:

(1) to support the PA to deliver to the Palestinian population essential basic services

by maintaining the functioning of the administration;

(2) to improve the economic opportunities of poor, vulnerable and isolated

population and;

(3) to support the PA in reducing its budget deficit and implementing its reform

agenda while increasing the PA's transparency and accountability.

Target group / Beneficiaries

Three categories of public expenditure are in principle eligible for support under this

action, for a total amount of EUR 130 million which follows previous Decisions

committed on 2008, 2009, 2010, 2011, 2012, 2013 and 2014 funds. Component 2 is "Supporting the Palestinian social protection system" (indicative allocation EUR 40 million).

The EU will contribute to the quarterly payment of social allowances to poor and

vulnerable Palestinian families in the West Bank and the Gaza Strip through the PA's

national cash transfer programme (CTP). The objective of this activity is to ensure

the continued assistance to Palestinian families living in extreme poverty, who are

dependent on financial aid from the PA. This activity also reinforces the reform of

the social protection system and the social cohesion among Palestinians.


The aim is to support households living in extreme poverty in the West Bank and Gaza, eligible to receive cash assistance under the cash transfer programme (CTP) run by the PA Ministry of Social Affairs (PA MoSA). Households are assessed individually to verify eligibility and level of assistance on a regular basis. Eligible households receive scaled allowances, determined on the basis of household size and welfare status, ranging from a minimum ILS 750 to a maximum ILS 1,800 (approx. EUR 160 to EUR 385) per quarterly payment.

The Austrian contribution usually is part of the first quarterly payment of social allowances, i.e. this Austrian contribution is planned to contribute to the spring 2016 payment. In total, each quarterly payment (to which other donors contribute, too) amounts to approximately 10.000 EUR and reaches around 50.000 Palestinian families - or 300.000 people - in need.


Most of the European Union's assistance to the Palestinian Authority (PA) is

channelled through PEGASE2, the financial mechanism launched in 2008 to support

the Palestinian Reform and Development Plan (2008-2010) and the subsequent

Palestinian National Development Plans (PNDP) developed for the periods 2011-

2013 and 2014-2016 with the aim to build strong governmental institutions as the

basis for the future independent Palestinian State. These national plans set out

medium-term agenda for Palestinian reform and development and contain a

framework of goals, objectives and performance targets. Through PEGASE Direct Financial Support (DFS), the EU has contributed

substantially to the recurrent expenditure of the Palestinian national budget (over

1 This designation shall not be construed as recognition of a State of Palestine and is without prejudice to individual

positions of the Member States on this issue.

2 Mécanisme Palestino-Européen de Gestion de l'Aide Socio-Economique.


EUR 1.7 billion since 2008), with systematic, predictable and unconditional

contributions to the payment of PA civil servant's salaries and pensions (window

'CSP') and of social allowances to the poorest and most vulnerable Palestinians

families (window 'VPF').

project number 2562-01/2015
source of funding OEZA
sector Andere soziale Infrastruktur und Leistungen
tied 0
modality Basket funds/pooled funding
marker Gender: 1, Democracy: 1, Poverty: 2
  • Policy marker: are used to identify, assess and facilitate the monitoring of activities in support of policy objectives concerning gender equality, aid to environment, participatory development/good governance, trade development and reproductive, maternal, newborn and child health. Activities targeting the objectives of the Rio Conventions include the identification of biodiversity, climate change mitigation, climate change adaptation, and desertification.
    • 1= policy is a significant objective of the activity
    • 2= policy is the principal objective of the activity
  • Donor/ source of funding: The ADA is not only implementing projects and programmes of the Austrian Development Cooperation , but also projects funded from other sources and donors such as
    • AKF - Foreign Disaster Fund of the Austrian federal government
    • BMLFUW - Federal Ministry for Agriculture, Forestry, Environment and Water
    • EU - Funds of the European Commission
    • Others - various other donors are listed in ADA’s annual business report.
  • Type of Aid – Aid modalities: classifies transfers from the donor to the first recipient of funds such as budget support, core contributions and pooled programmes and funds to CSOs and multilateral organisations, project-type interventions, experts and other technical assistance, scholarships and student costs in donor countries, debt relief, administrative costs and other in-donor expenditures.
  • Purpose/ sector code: classifies the specific area of the recipient’s economic or social structure, funded by a bilateral contribution.
  • Tied/Untied: Untied aid is defined as loans and grants whose proceeds are fully and freely available to finance procurement from all OECD countries and substantially all developing countries. Transactions are considered tied unless the donor has, at the time of the aid offer, clearly specified a range of countries eligible for procurement which meets the tests for “untied” aid.