Supreme Court Considers Budget Disparities Between Arab and Jewish Municipalities


On Tuesday, 13 November 2001, the Supreme Court began hearings on a petition concerning the discriminatory policy applied by the Ministry of the Interior (MOI) in distributing balance grants to the Arab local authorities. Adalah filed the petition on behalf of the National Committee of Arab Mayors and the Municipality of Nazareth.


Chief Justice Aharon Barak ruled for a continuance after a representative of the Attorney General announced that the Gadish Committee report had been submitted to the Minister of the Interior that day. The Gadish Committee was established about a year ago to examine MOI policy concerning the distribution of balance grants to local authorities, and to create new criteria for distribution of these funds. The Attorney General’s representative argued before the court that, based on their calculations, there was no discrimination in the distribution method. On the contrary, the representative argued, there is a policy of affirmative action, as the percentage of the balance grants program budget allotted to Arab authorities is 21.5 %, which is greater than the proportion of Palestinians in the state.


Adalah Staff Attorney Jamil Dakwar rejected this argument, and responded that the MOI response includes information that could potentially mislead the court. Mr. Dakwar stated that the main purpose of the balance grants is to support local councils that suffer from weak financial situations, in order to ensure a minimum of basic services for their residents. Therefore, he argued, funding allotments for the Arab local authorities should be among the highest in the country, since these authorities consistently rank lowest on social and economic indices. Ethnic proportionality is not a relevant consideration; rather, distributions should be based on economic need.


The petition, originally filed on 7 August 2001, demanded that the government reject the criteria currently applied by the MOI in determining the distribution of balance grants, and implement objective, equal and unified criteria. The petitioners also argued that the MOI’s discriminatory policy in the distribution of balance grants contradicted the recommendations of the State Comptroller and the Swari Committee, an earlier body established to evaluate balance grants distribution. The Swari Report, issued in 1993, recommended that the means of calculating the balance grant consider the necessary public expenditures required by every local authority in order to provide its citizens with at least a minimum of required services; the income of the local authority; and the socio-economic ranking of the authority’s citizens according to the Central Bureau of Statistics.


At the end of Tuesday’s session, the court gave the petitioners 10 days to submit their reaction to the Gadish Committee report. The proceedings will continue in December.