Proposal for a COUNCIL DECISION to approve the text of a ninth EC-UNRWA Convention covering the years 1996-98 prior to signature of the Convention by the Commission and the United Nations Relief and Works Agency for Palestine refugees
Date: 1996-06-10
Institutions: European Commission
Subjects: EU aid, Palestine question, UNRWA, agreement (EU), aid programme

COMMISSION OF THE  EUROPEAN  COMMUNITIES 

* * * ** 

* * * ** 

Brussels,  10.06.1996 
COM(96) 257 final 

96/0154 (CNS) 

Proposal  for a 
COUNCIL  DECISION 
to approve the text  of a ninth  EC-UNRWA  Convention  covering the years  1996-98 prior to 
signature of the Convention by the Commission and the United Nations Relief and Works Agency 
for  Palestine  refugees 

(presented  by the  Commission) 

EXPLANATORY  MEMORANDUM 

The Commission has taken up contact with officials  of UNRWA in order to negotiate 
a ninth EC-UNRWA convention to govern the Community contribution to UNRWA 
for the years 1996-98, on the basis of the negotiating directives approved by the 
Council on 6th October  1995. 

I 

POLITICAL BACKGROUND 

Final status negotiations between the Government of Israel and the Palestine 
Liberation Organisation of the issue of Palestinian refugees are not due to commence 
until May 1996 at the earliest.  According to the Declaration of Principles signed 
between the two parties in October  1993, the issue will not be settled until the end of 
the 'interim period', that is, until 1998. 

The European Union position on the Middle East Peace Process has been one of 
supporting the efforts  of the parties to reach a peaceful  resolution of their  differences 
by means of bilateral and multilateral negotiation.  A key element of this strategy has 
been that of reassuring the Palestinian side that the international community believes 
that the Declaration of Principles should be fully respected, and that the refugee issue 
should not be put to one side during final status negotiations.  The continuing support 
of the Community for the United Nations Relief and Works Agency for Palestine 
Refugees (UNRWA)1 is a key element in this strategy. 

As for the size of the Community contribution under the convention, throughout 
negotiations the Commission has borne in mind the feeling amongst donors, including 
member states, that donor contributions to UNRWA should take into account the 
increased burdens placed on the Agency by the rate of increase in the Palestinian 
population, and of inflation  The Community contribution should at any rate be 
maintained at a minimum consistent with the maintenance of provision to the  refugees 
of services at reasonable levels.  Notwithstanding, the Commission has required 
justification  by UNRWA of the increases proposed to the Community contribution to 
its programmes, in relation to contributions made under the eighth Convention, and 
indeed of the changing emphasis in the use of the Community contribution away  from 
its health programmes and towards education. 

It is a possibility, however remote, that during the life of the convention some of the 
services provided by UNRWA to the refugees will be passed to the Palestinian 
Council.  Indeed, UNRWA convoked its major donors to Amman in mid-1995 to 
explain and discuss its plans for eventual handover of its functions to the Council; 
UNRWA is already making efforts to harmonise its services with those of the 
Council, and its officials liaise ever more closely with those of the Council.  UNRWA 
officials  are adamant that UNRWA as an organisation must have a finite life, and look 
forward to a settlement of the refugee issue. 

Handover, and the timing of handover, is an issue ultimately between the Palestinian 
Council and UNRWA.  UNRWA does need to be assured of the financial stability 

In 1995 the Community, under the eighth Convention between the European Community and 
UNRWA, was the second largest contributor to the budget of UNRWA its contribution making 
up 19% of total contributions (the European Union, counting both member states' bilateral 
contributions and the Community contribution, was the largest donor - 43% of total 
contributions). 

X 

offered  by a three-year convention.  This handover is unlikely in the period  1996-98 
Nevertheless, handover, even partial or phased handover, however unlikely, naturally 
could have implications for the Community contribution to the regular budget of the 
Agency, and it is right that the convention make allowance for this.  It is appropriate 
to make contingent provision under the convention for a workable mechanism for 
altering the Community contribution. 

II GENERAL COVERAGE OF THE CONVENTION 

Since 1972 the EC and UNRWA have signed eight conventions2 governing the EC 
contribution to the regular and food aid budgets of the Agency.  Each convention has: 

• 

set out the contribution to the regular (education, health and relief and social 
services) programme budget for the forthcoming three year period; and 

• 

allowed for the annual negotiation of the contribution to the food  aid budget. 

The proposed appropriations under the new convention are thus intended as a 
contribution towards the financing of UNRWA's regular programme for some 2.8 
million Palestine refugees in five fields of operation: Jordan, Syria, Lebanon, the West 
Bank and the Gaza Strip  It would also allow for the annual negotiation of the 
Community contribution to the food aid programme. 

The Commission has nonetheless been conscious, during negotiations, that at some 
point UNRWA will hand over its functions to the Palestinian Council, and even other 
administrations in the region.  UNRWA has indeed already begun to formulate plans 
for a gradual handover.  A review of political developments and an evaluation of 
progress made by UNRWA towards putting handover plans into operation, has been 
incorporated into the convention, to take place two years following  signature.  Such a 
review will enable the Commission to foresee the order of magnitude of the Agency's 
financial  requirements beyond  1998, and thus to keep member states appraised of the 
level of contribution UNRWA may request the Community to make beyond the life of 
a ninth convention. 

It is therefore possible, if not likely, that UNRWA's financial requirements fall even 
during the 1996-98 period.  This could be the case, for example, if any of the 
Agency's functions were during the life of the convention to be handed over, thus 
reducing UNRWA's recurrent costs.  An article has therefore been included in the 
text to allow for reductions in the Community contribution under this convention, 
should this be appropriate. 

EEC-UNRWA Convention  1972-74, OJ No L 304 of 31.12.1972, p. 24 
EEC-UNRWA Convention  1975-78, OJ No L 203 of 28.07.1976, p. 40 
EEC-UNRWA Convention  1979-80, OJ No L 108 of 26.04.1980, p. 56 
EEC-UNRWA Convention  1981-83, OJ No L 392 of 31.12.1981, pp. 3-6 
EEC-UNRWA Convention  1984-86, OJ No L  188 of  16.07.1984, pp. 18-1 
EEC-UNRWA Convention  1987-89, OJ No L  136 of 26.05.1987, p. 43 
EEC-UNRWA Convention  1990-92, OJ No L 118 of 09.05.1990, p. 36 
EC-UNRWA Convention  1993-95, OJ No L 9/16 of 13.01.94 

3 

Ill  CONTRIBUTIONS UNDER THB NINTH CONVENTION 

UNRWA's regular programmes include its education programme, health programme, 
and relief and social services programme.  UNRWA has argued in general terms the 
reasons for the annual increases in its budgetary needs, leading to increases in 
Community contributions under a ninth convention as compared to those under the 
eighth.. 

A natural rate of growth of 3.5% per annum in the beneficiary population increases 
the costs of providing basic services, as does inflation.  With almost 21,000 
employees (including over 13,000 teachers), staff costs account for over two thirds of 
UNRWA's budget.  The inevitable increase in such costs creates the heaviest 
additional demand on the Agency's budget.  Alone the award to staff of the annual 
salary increment to which they are entitled (not a salary increase) requires a 2% 
increase in the total salary budget. 

A Community contribution under the ninth convention would be made towards 
UNRWA's education and health programmes: 

34.1 MECU in 1996; 

35.3 MECU in 1997; and 

36.5 MECU in 1998. 

These overall figures break down as follows. 

1.  Education programme 

Under its education programme, UNRWA provides education to over 400,000 
pupils.  The objective of this programme to meet the basic educational needs of 
Palestine refugees, and to enhance their educational opportunities at all levels of the 
educational system.  This objective is met by means of a general education sub-
programme, teacher education, and vocational and technical education. 

UNRWA schools operate economically, with an average of 40.3 pupils per teacher at 
the elementary level and 30.3 at the preparatory level.  The annual cost per pupil 
enrolled is low by regional and international standards, averaging $266 per pupil at 
the elementary level and $371 per pupil at the preparatory level. 

Education is nevertheless UNRWA's largest programme, accounting for almost half 
of its total budget.  Refugee population growth of about of about 3.5% per annum 
creates a requirement for substantial increases in teaching staff to keep pace with 
school population.  This is expected to grow from 408,861 pupils in 1994-95 to 
426,816 by the end of the  1996-97 biennium.  (The programme must cope with an 
average annual increase in elementary school enrolment of 2.42%, and in preparatory 
enrolment of 2.2%)  A new factor in the growth of the school population is the influx 
into the West Bank and Gaza Strip of returning refugee families since the 
establishment of the Palestinian Authority (now Council) in Gaza, and of its police 
force.  It is also possible that those displaced in 1967 may start to opt for return.  In 
the school year 1994-95 UNRWA admitted 4,358 children of returning  refugee 
families into its Gaza Strip schools. 

4-

•  Thus the Community contribution for the education programme will amount 

under this convention to: 

ECU 28 million in 1996; 

ECU 29.4 million in 1997; and 

ECU 30.9 million in 1998. 

2.  General health programme 

UNRWA's health programme is community-based, with the emphasis placed on 
primary health care, complemented, to the extent financially possible, by some 
secondary and tertiary care. 

The numbers of refugees living in camps has doubled over the last 25 years,  from 
492,000 in December  1970 to 983,000 in March  1995.  The high population density 
associated with the camps increases the need for environmental health services, 
provided by UNRWA in the camps in cooperation with host Governments and 
municipalities. 

The growth in the refugee population, in particular the growing number of infants and 
elderly people who place the greatest demands on the health programme, increases 
the cost of providing basic health care, as does the cost of and high demand for 
hospitalisation.  The Agency is making strenuous efforts  to contain its expenditure on 
secondary and tertiary care. 

•  Thus the convention allows for contributions to the general health programme 

of: 

ECU 3.4 million in 1996; 

ECU 3.6 million in 1997; and 

ECU 3.8 million in 1998. 

3.  Other contributions to the health programme 

However, as well as the continuation of general health services, the health programme 
will place emphasis on an expanded sub-programme of maternal and child health 
including family planning, the development of programmes for control of non-
communicable diseases, the containment of hospital services costs, environmental 
health, and the nutrition and supplementary feeding sub-programme. 

•  Under the convention, the Community will contribute to specific components of 

this health programme: 

ECU 2.7 million in 1996 ( 0.9 MECU for the running costs of the family planning 
programme; 1.1 MECU for the expansion of this programme1, and for other 
improvements (mainly by means of helping to cover staff costs) in the health 
programme, plus other support staff, 0.7 MECU); 

Note that the family planning programme was funded  under the eighth EC-UNRWA 
Convention. 

S" 

ECU 2.3 million in 1997 (0.9 MECU for the running costs of the family planning 
programme; 0.7 MECU for the expansion of this programmé*; and for other 
improvements (mainly by means of helping to cover staff costs) in the health 
programme, plus other support staff, 0.7 MECU); and 

ECU  1.8 million in 1998 (0.9 MECU for the running costs of the family planning 
programme; 0 7 MECU for the expansion of this programme3; and for other 
improvements (mainly by means of helping to cover staff costs) in the health 
programme, plus other support staff, 0.2 MECU). 

4.  Food aid programme 

UNRWA is requesting that the new convention, as has been customary, allow for the 
annual negotiation of the Community contribution in kind to UNRWA's programme 
of food aid. 

The financial implications of the proposed action are specified at the financial annex. 

IV  ACTION PROPOSED 

The Commission therefore recommends that the Council approve, after  consultation 
of the Parliament, the text of the ninth convention with UNRWA and authorises the 
Commission to sign it on behalf of the EC. 

Proposal  for a 
COUNCIL DECISION 
to approve the text of a ninth EC-UNRWA  Convention covering the years  1996-98 prior to 
signature of the Convention by the Commission and the United Nations Relief and Works Agency 
for Palestine  refugees 

(presented by the Commission) 

"3 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty establishing the European Community, and in particular 
Article  130y in conjunction  with Article 228 (3) first subparagraph thereof, and with 
Article 228 (4), 

Having regard to the proposal from the Commission, 

Having regard to the opinion of the European Parliament *), 

Whereas the Convention concluded with the United Nations Relief and Works Agency for 
Palestine Refugees  (UNRWA) concerning aid to refugees in the countries of the Near 
East, approved on 16th December  1993(2), expired on 31st December 1995; 

Whereas the Community assistance to UNRWA forms part of the campaign against 
poverty in the developing countries and thereby contributes to the sustainable economic 
and social development of the population concerned and the host countries in which that 
population lives; 

Whereas a new Convention should be concluded with UNRWA so that the Community's 
aid can continue to be provided as part Of a comprehensive programme offering  a measure 
of continuity; 

Whereas continued support of UNRWA operations would be likely to contribute to the 
attainment of the Community objectives described in the above paragraph; 

Whereas the new Convention provides for simplified procedures allowing, as necessary, 
for either the withdrawal of the Community contribution to certain programmes of 
UNRWA or, in agreement with UNRWA, adjustments to the Community contribution; 

Whereas, as a consequence, the Commission should be authorized to approve such 
modifications under certain specific conditions; 

HAS DECIDED AS FOLLOWS; 

Article 1 

The Convention between the European Community and the United Nations Relief and 
Works Agency for Palestine Refugees  (UNRWA) concerning aid to refugees in the 
countries of the Near East is hereby approved on behalf of the Community. 

The text of the Convention is attached to this Decision. 

Article 2 

The execution of the Community programme of food aid to UNRWA shall be governed 
by the procedure defined in Regulation (EEC) No 3972/86(3) or, if appropriate, by any 
regulation on food aid repealing and replacing it. 

1 
2 
3 

O J No XXXXX 
OJ No L 9/16,  13.01.94, p. XXXXX 
OJ No L 370, 30.12.1986, p. 1 

Article 3 

The Commission, after consultation of the committee designated for this purpose by the 
Council, shall proceed as necessary to notify UNRWA of the withdrawal of its 
contribution according to  Article 2 (4) of the Convention  Following the same procedure, 
the Commission will agree, as necessary, with UNRWA the appropriate adjustments 
foreseen at Article 5 of the Convention. 

Article 4 

The President of the Council is hereby authorised to designate the persons empowered to 
sign the Convention in order to bind the Community. 

Done at Brussels, 

For the Council 

The President 

CONVENTION 

between the European Community and the United Nations Relief and Works Agency for 
Palestine Refugees (UNRWA) concerning aid to refugees in the countries 
of the Near East 

Article 1 

The European Community (hereinafter  referred to as 'the Community') hereby 
concludes this Convention with the United Nations Relief and Works Agency for 
Palestine Refugees  (hereinafter  referred to as 'UNRWA') in order to confirm its 
commitment to a programme of aid to UNRWA.  This aid shall take the form of 
contributions in kind or in cash extending over a three-year period for use under the 
UNRWA education, health and feeding programmes. 

Article 2 

1.  The Community shall pay to UNRWA annually a cash contribution towards the cost 
of the education and health programmes.  The size of this contribution shall be ECU 
28 million in  1996, ECU 29.4 million in  1997 and ECU 30.9 million in  1998 for the 
education programme; ECU 3 4 million in  1996, ECU 3 6 million in 1997 and ECU 
3.8 million in 1998 for the general health programme; and ECU 2.7 million in 1996, 
ECU 2.3 million in 1997 and ECU 1.8 million in 1998 for various specific 
components of the health programme (including the operation and expansion of the 
family planning programme, and for other support staff).  The distribution of these 
amounts between the three headings stipulated will be amenable to adjustment by 
UNRWA each year, according to its needs, and on condition that the Commission is 
informed accordingly. 

2.  UNRWA shall send the Community each year a report on the use made of the 
Community contribution.  UNRWA shall also provide the Community with any 
documentation that it may require relating to the execution of the education and 
health programmes, including the supplementary feeding programme; as well as any 
documents that will give detailed accounts of expenditure and budgetary estimates of 
future expenditure and the annual statistics of the UNRWA departments of education 
and health. 

3.  UNRWA shall inform the Community of any significant  changes that may be planned 

in the education or health services provided by the Agency. 

4. 

In the event of any significant  changes in the education or health services provided by 
UNRWA during the period of validity of this Convention, the Community reserves 
the right to withdraw its agreement on the use of the funds made available to 
UNRWA under the Convention for these purposes.  In such a case or cases the 
Community would notify UNRWA accordingly. 

Article 3 

Aid for UNRWA's food aid programmes 

1.  Other Community resources can also be mobilised to meet the specific needs of 

vulnerable groups. 

[a 

2.  The amounts and characteristics of the commodities and services provided will be 
subject to separately agreed financing conditions, based on annual requests  from 
UNRWA 

3.  UNRWA shall send the Community, each year, a report on the operation of the 

feeding programmes, indicating in particular the number, category and location  of 
recipients and the services provided, the cost of the programmes and the use made of 
Community contributions in kind and in cash. 

Article 4 

Review 

By end  1997, political developments regarding the refugees will be reviewed by the 
parties, and an evaluation made of any plans UNRWA has formulated,  and, if this is 
the case, put into effect,  for the handover of its functions to the Palestinian Council 
and/or any other body. 

Article 5 

Adjustments 

If,  during the life of the Convention, any or all of the functions of UNRWA are 
transferred to the Palestinian Council or to any other body, adjustments will be made, 
as appropriate, to those parts of the Community contribution to UNRWA under the 
Convention which are otherwise fixed under Article 2 paragraph  1, on the basis of an 
exchange of letters between the Community and UNRWA. 

Article 6 

Financial control, and visits 

1.  UNRWA shall: 

i. 

keep financial and accounting documents concerning the activities financed by the 
Community; and 

ii.  make available to the competent bodies of the Community, upon request, all relevant 

financial  information including statements of accounts concerning the 
programme/project, whether they are executed by UNRWA or by subcontracting. 

In conformity with the Financial Regulation of the Community, the Commission and 
the Court of Auditors may undertake, including on the spot, check related to the 
operations financed by the Community. 

2.  UNRWA will facilitate the visits of representatives of the Community to the sites of 

UNRWA operations. 

\\ 

Ai  Article 7 

Any dispute arising out of this Convention shall be settled by consultation between 
the two parties at the request of either party. 

Article 8 

Duration of the Convention 

This Convention shall cover a period of three calendar years (1996,  1997 and 1998). 

Article 9 

This Convention shall be drawn up in duplicate in the Danish, Dutch, English, 
Finnish, French, German, Greek, Italian, Portuguese,  Spanish and Swedish languages, 
each version being equally authentic. 

il 

FINANCIAL ANNEX 

Relevant articles of the Community budget 

Contributions  to  the  regular  programme:  B7-421  (Aid  to  the  United  Nations  Relief 
and Works Agency for Palestine Refugees in the Near East) 

Food  aid: B7-200 (Food  aid and  support  operations), B7-201  (alternative  operations 
in place of food  aid deliveries), B7-202 (Transport,  distribution,  storage and  support 
operations) 

Description of action 

Conclusion  of  a new  convention  between  the  EC  and  UNRWA  for  the  Community 
contribution to UNRWA's regular programme of education and health services, and its 
extraordinary programme of food aid. 

Legal base 

Articles  130u,  130w,  228§3  and  228§4  of  the  Treaty  Establishing  the  European 
Community 

Financial implications 

Regular programmes 
UNRWA  are requesting  support  to  its regular  programmes  of  34.1 MECU  in  1996, 
35.3 MECU in  1997 and 36.5 MECU in  1998 (a total of  105 9 MECU over the three 
year  period,  representing  a  year-on-year  increase  in  the  Commumty  contribution  of 
6.6%,  3.5%  and  3.4%,  and  an  average  annual  increase  of  4.5% in  the  Community 
contribution over the three year period). 

More specifically, the amounts proposed for the education programme are: 28 MECU 
in  1996; 29.4 MECU in  1997; 30.9 MECU in  1998.  These figures would  represent a 
year-on-year increase in the Community contribution, from 1995, of 5% each year 

The amounts proposed for the regular health care programme are: 3.4 MECU in  1996; 
3.6 MECU in 1997; 3.8 MECU in 1998. 

Also  as  part  of  the  overall  health  programme,  the  amounts  proposed  for  the  cash 
component  of the supplementary feeding  programme, and for improvements in health 
care (including family planning and its expansion) are: 2.7 MECU in 1996; 2 3 MECU 
in  1997; and  1.8  MECU  in  1998.  Taken together,  the Community  contributions  for 
the  health  programme  as  a  whole  would  increase  by  an  average  of  2.3%  This 
increase  reflects  the  costs  of  the  family  planning  programme,  not  under  previous 
conventions  charged  to  the  Community  budget,  and  to  the  expansion  of  this 
programme. 

Contribution to feeding programmes 
The  size  and  content  of  the  annual  contribution  to  UNRWA  for  the  feeding 
programmes  will  be  decided  according  to  the  procedure  laid  down  in  Regulation 
(EEC) No 3972/86. 

\3> 

Table I 

EC contribution to UNRWA's regular programme for  1996,  1997 and  1998, as proposed 
by UNRWA in its initial approach to the Commission 

Programme 
Education 
Health  programme 
Other 
contributions 
(particularly family  planning) 
TOTAL 

to 

the  health 

programme 

1996 

1997 

1998 

28 
3.4 

2.7 
34.1 

29.4 
3.6 

2.3 
35.3 

30.9 
3.8 

1.8 
36.5 

Table 11 

EC contributions under the  1993-95 EC-UNRWA Convention to  UNRWA's regular and 
food aid programmes 

Programme 
Education 
Health  programme 
Cash component  of supplementary  feeding  programme 
Sub-total  - regular  programme 
Food  products (in value, at world prices, delivered  free 
at  destination) 
Costs of distribution  and supervision 
Sub-total - food  aid  programme 
TOTAL 

1993 

1994 

1995 

24.2 
5 
0.8 
30 
19.38 

2.24 
21.62 
51.62 

25.4 
4.9 
0.7 
31 
11.69 

1.2 
12.89 
43.89 

26.7 
4.7 
0.6 
32 
7.2 

0.81 
8.01 
40.01 

n 

ISSN 0254-1475 

COM(96) 257  final 

DOCUMENTS 

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