Itamar Ben Gvir Rejects Reviving Palestinian Authority Despite Settlement Incentives

Itamar Ben Gvir, Israel's National Security Minister and leader of Otzma Yehudit, revealed in an interview with Srugim that senior government officials tried to persuade him to support the continuation of a financial indemnity mechanism for Israeli banks dealing with Palestinian banks. This mechanism protects Israeli banks from legal risks associated with their Palestinian counterparts. In exchange, Ben Gvir was offered extensive building permits in Judea and Samaria and other political gains related to settlements, governance, and policing.

Ben Gvir disclosed that he was offered the construction of additional homes in the settlements if he refrained from opposing the financial support to the Palestinian Authority (PA). He firmly rejected the proposal, stating, "I am not willing to revive the Authority. It is an authority of blood." When asked if Prime Minister Benjamin Netanyahu was the senior official who made the offer, Ben Gvir neither confirmed nor denied it. He emphasized that even if offered 700,000 more homes, he would not legitimize the PA, insisting it must be dismantled.

The indemnity mechanism is central to the dispute, as it shields Israeli banks from legal exposure when working with Palestinian banks. Without it, Israeli banks might sever ties, potentially crippling Palestinian commerce and triggering a severe economic crisis in the PA. Security officials warn such a collapse could lead to security chaos. However, Ben Gvir argues that this financial lifeline artificially sustains an entity that promotes terrorism and acts against Israel.

Ben Gvir also sharply criticized Finance Minister Bezalel Smotrich for approving the mechanism's continuation in exchange for settlement construction achievements. According to reports, Ben Gvir confronted Smotrich during a cabinet meeting, accusing him of "selling out principles for a few houses." This dispute highlights a rift within the right-wing leadership: Smotrich accepted a deal that advanced settlements but kept the PA financially alive, while Ben Gvir rejected similar offers, prioritizing the PA's dismantling over political gains.

Ben Gvir's stance underscores his opposition to any government policy that sustains the Palestinian Authority economically, regardless of the settlement benefits offered in return.