Audit says Israel funded settlements

JERUSALEM -- The Israeli government quietly provided about $6.5 million over a 3-year period to build unauthorized offshoots of Jewish settlements in the West Bank, according to an auditor's report released yesterday.

The removal of such outposts -- communities that sometimes consist of little more than a rusting trailer or a rickety water tower -- is a central tenet of the stalled "road map," the US-backed peace plan to which Prime Minister Ariel Sharon's government agreed.

The settlement offshoots, though usually small, are significant because they represent a bid by the settlers to lay claim to additional West Bank territory, usually by leapfrogging to rocky hilltops next to existing settlements.

The disclosure that the government had been funneling money to the outposts surprised few Israelis, but it brought angry demands from peace activists and left-wing politicians for removal and prosecution of Effi Eitam, the nation's housing minister.

Eitam is the leader of the National Religious Party, the chief patron of the settlement movement and a coalition partner in Sharon's government.

Tensions between Sharon and far-right elements in his Cabinet are running high after his Likud Party decisively rejected his plan to withdraw from all Jewish settlements in the Gaza Strip and four isolated ones in the West Bank. An intensive, grass-roots lobbying campaign by settlers contributed to the sharp rebuff of the initiative by party members in a referendum on Sunday.

Settlement outposts have been somewhat on the back burner since Sharon unveiled his plan to get out of Gaza. Israeli troops have removed some of the ramshackle offshoots, but settlers -- most often members of a loosely organized, anarchy-minded group known as "hilltop youth" -- usually reestablish them within days.

The report by Eliezer Goldberg, the state comptroller, said that from January 2000 to June 2003 the Housing Ministry provided about $6.5 million used for infrastructure for the outposts, including roads, water outlets, and electrical supplies.

"Finally, we have real proof that the settlers themselves were not putting up the money to do this; the government was giving it to them," said Yaariv Oppenheimer of the Israeli group Peace Now, which has tracked the outposts for years.

By Peace Now's count, 102 unauthorized settlement outposts exist in the West Bank, 61 of them built since Sharon took office in early 2001. Twenty-one outposts were removed, but only one of those was inhabited and most others were quickly rebuilt, Oppenheimer said.

In other developments yesterday, Palestinian legislators took the highly unusual step of firing a senior official who was implicated in possible corruption. The Parliament ousted Amin Haddad, head of the Palestinian Monetary Authority, after an investigation suggested that large losses by the official Bank of Palestine could be traced at least in part to him. The bank has lost $34 million in three years.

Establishing fiscal transparency has been a top priority for reform-minded members of the Palestinian government in recent months after international donors sternly warned that the flow of aid money would dry up unless the Palestinians could account for it.

On the Israeli side, Sharon's aides said the prime minister will travel to Washington next week for talks with US officials on how to salvage his plan for a Gaza withdrawal. The White House was chagrined by the referendum defeat, which came after the Bush administration backed Sharon's plan, angering much of the Arab world.

While the prime minister's camp sought to regroup from the setback this weekend, long-simmering tensions on Israel's northern border boiled over into an exchange of fire.

Israeli warplanes bombed what the military said were bases of the Shi'ite Muslim group Hezbollah. No injures were reported. The strike came after antiaircraft shells were fired at Israeli jets from the Lebanese side -- rounds that landed in northern Israel but caused no damage or injuries.

Also yesterday, Israel released a cofounder of Hamas, Mohammed Taha, after holding him for 14 months without charges, the Associated Press reported. Taha, accused of leading the military wing of Hamas, was arrested in a raid on the Boureij refugee camp in central Gaza.

In the West Bank village of Talouza, troops shot dead an armed Hamas fugitive, the army said. Villagers said the man, Einad Janajra, was the target of an Israeli raid last month but escaped, and a bystander was shot dead instead. The army later apologized for killing the bystander, a university lecturer.

In Gaza, two Palestinians were killed yesterday in fighting with the Israeli Army.

Palestinian officials said one person was killed after entering an unauthorized area near the border with Israel. The military said soldiers opened fire on two men, hitting one.

In the central Gaza town of Deir al-Balah, a Palestinian security guard was killed by Israeli gunfire after dozens of youngsters began throwing stones at troops. One of the wounded, Mahmoud Hams, is a news photographer working for Agence France-Presse.