An aerial view of the Palestinian neighborhood of Beit Hanina in East Jerusalem, December 3, 2022


Hagai Agmon Snir, Wikipedia

Blog Post

Israel Approves Funding Plan for East Jerusalem—with an Ominous Condition

On August 20, 2023, the Israeli government approved an additional five-year development plan for East Jerusalem with a budget of NIS $3.2 billion ($850 million),1 the largest public investment in East Jerusalem since Israel occupied it in 1967. The program allocates funds to infrastructure, housing, healthcare, education, public transportation, employment, welfare, the environment, and other areas, although who will actually benefit remains to be seen.

The government tasked the Ministry of Jerusalem Affairs and Jewish Tradition with overall management and implementation of the plan. Government intent could be discerned from statements made during the press conference announcing it, which stressed “reinforcing Israeli sovereignty,” “uniting Jerusalem,” and ensuring the “development and prosperity of Jerusalem as our eternal capital.”2

Approval Follows Three-Month Delay

The plan was supposed to be approved on May 18 (which Israel designates as “Jerusalem Day”), but Finance Minister Bezalel Smotrich froze the plan3 over the inclusion of NIS 200 million ($54 million) for precollege preparatory programs for Palestinian students at the Hebrew University of Jerusalem and the Israeli colleges of Bezalel, Hadassah, and Azrieli.4 Around 500 Palestinian students have enrolled in these programs yearly, aimed at integrating Palestinian Jerusalemites into Israeli higher education, since they were introduced in 2018 under Decision 3790. The funds let them attend almost for free. The funds were the finance ministry’s share of the total funding for the programs; the other NIS 250 million was to come from the education ministry. Without the funding, the programs would likely close.

Smotrich believes that encouraging higher education among Palestinians radicalizes them and leads to what he terms “extremism.” Calling himself “not anyone’s rubber stamp,” he said in a lengthy Facebook post5 on August 7 that he would not unfreeze the money until the problem of “extreme Islamic cells . . . in Israeli universities and colleges that repeatedly express solidarity with the enemies of Israel” and which “make the lives of Jewish students intolerable during periods of tension” is solved. He apparently feels that the Hebrew University is becoming a “mirror image of Bir Zeit”6 and fosters “cells of nationalist radicalization.”7 Smotrich did not respond to requests for comment on these allegations and how he plans to fix this purported issue.

Government officials from parties across the political spectrum protested and pushed back on Smotrich.8 The Hebrew University released a statement denouncing the move, saying cutting the program will “increase hostility, enmity and violence between the two communities.”9

Danny Miadovnik, a professor of political science at the Hebrew University who was a coauthor of a study about how the preparatory programs affect attitudes of Palestinian students, views Smotrich’s opposition differently: “It’s clear that Smotrich has no idea what he’s talking about. Every responsible entity in the country, from research institutes to the security forces, says the opposite. But the worst thing is that he doesn’t like the connection created here. He doesn’t want Jewish and Arab boys and girls to be together in the same place. Just like he doesn’t want his wife to be near an Arab woman in a maternity ward.”10

“He [Smotrich] doesn’t want Jewish and Arab boys and girls to be together in the same place.”

Danny Miadovnik, Professor of Political Science, Hebrew University of Jerusalem

Following the backlash, Smotrich eventually relented, agreeing to release the funds on the condition that a new committee be created comprising the director general of the Ministry of Jerusalem Affairs and Jewish Tradition, a member of the Prime Minister’s Office, the head of the budget division at the finance ministry, the accountant general and the director general of the Jerusalem Municipality, and that the Jerusalem Municipality oversee fund allocation.11 Smotrich called for stricter “red lines regarding incitement and terror and identification with enemies on campus” insisting that “I won’t fund incitement or support for terror in universities.”12 Some reports indicated that the funding for the higher education preparatory programs was in fact dropped and replaced with a subsection called “Encouraging High Productivity Employment (implying that the focus shifted from higher education to employability of Palestinians students).”13 But there were questions over whether this would, in fact, terminate the preparatory programs.

Implications of Oversight

Dr. Nadera Shalhoub-Kevorkian, a professor and a global chair in law and criminology at the Hebrew University and Queen Mary University of London who is also a licensed social worker, believes that the changes that were made to get Smotrich to agree to release the funding will “cut more breathing spaces for Palestinians.” She told Jerusalem Story, “Smotrich ended up approving the budget, but pending on the fact that the Ministry of Finance will have more control over every act of the different programs carried out by the Hebrew University or by other agencies at the university.” 

When asked what she believes this will mean, Shalhoub-Kevorkian replied, “The approval is packed with policing power. They said that they will appoint a committee that will control all educational activities based on or funded by this program. What I read is that education is going to be more controlled, more under Israeli surveillance—cameras, technologies, facial recognition, and every single program is going to be under the scrutiny and the examination of the Shabak, the Mossad, and who knows what else. So that is not good news to me. It is just reflecting the control of the mind, but in a different way. From now on, every single lecture, talk, PowerPoint, etc. will be controlled, and the students who are participating will be surveilled—their names, their addresses, their IDs. So from one side, we now know that the aim is to cut. But it seems that he did not cut the funding; rather he managed to cut more breathing spaces for Palestinians.”

“From now on, every single lecture, talk, PowerPoint, etc. will be controlled.”

Nadera Shalhoub-Kevorkian, Professor of Global Law and Criminology, Hebrew University of Jerusalem

Coming from a Place of Hatred

“To us, [Smotrich is] the clearest vision of the occupation,” said Muhammad Abdelqader al-Husseini, chairman of the board of directors of the Faisal Husseini Foundation, a Palestinian organization supporting East Jerusalem’s Palestinian education sector.14 

Al-Husseini surmised that Smotrich is basing his decision-making on feelings as opposed to mutual interests. Smotrich, who is also a minister in the defense ministry in charge of civilian affairs in the occupied West Bank, called for “wiping out” the town of Huwara in the West Bank in March after Israeli settlers rampaged the town—killing one Palestinian and injuring hundreds15—in retaliation for the killing of two settlers near the village by a Palestinian gunman from Huwara. He backtracked his remarks after widespread condemnation.

“The decisions are coming more from hatred, from a racist background,” al-Husseini said. “Smotrich thought freezing the money will harm the Palestinians in the occupied city of Jerusalem, [but] the funding is going to Israeli institutions. So, at the same time, it’s harming the institutions that he’s funding.”

Decision 3790

The new plan continues the first five-year plan, entitled Government Decision 3790, which was introduced in 2018 and promoted as a comprehensive piece of legislation designed to strengthen Israeli sovereignty in East Jerusalem.16 That plan, which allocated NIS 2.2 billion to various areas, expires in December.

The bill was touted as improving the lives of East Jerusalem’s Palestinians, but experts have criticized it for worsening the housing crisis in East Jerusalem17 and pressuring Palestinian schools to switch to the Israeli curriculum—erasing their national identity.

The original 2018 decision was focused on six key areas in East Jerusalem: education, economy, transportation, quality of life, health, and land registration.18 While one of the bill’s goals—increasing Palestinian women’s employment—was met, job placement has primarily been in low-wage positions, thereby keeping Palestinians at the poverty level. Palestinian housing rights have also been hampered by the decision’s emphasis on settlement of land title (SOLT) procedures, essentially the process of finalizing land ownership. Instead of addressing East Jerusalem’s severe housing shortage or helping Palestinians obtain final titles to their lands, Decision 3790 has intensified state and settler takeovers of Palestinian land through SOLT. In education, the decision helped to increase extracurricular activities for students, yet didn’t fully address the needs for Palestinian informal education, specifically a lack of infrastructure and continuity. Additionally, classroom shortages remain a primary problem for East Jerusalem’s education system but Decision 3790’s funds have gone more to implementing the Israeli curriculum in schools as opposed to fixing infrastructure needs.

Blog Post Israeli Government Bill Aims to Deny Funding to Palestinian Schools in East Jerusalem

East Jerusalem schools may soon be given two bad options and forced to choose one: Teach the Israeli curriculum or lose funding.

What’s in the New Plan

The budget for the newly approved 2023 plan is 50 percent larger than the first one of 2018.

Concerning education, the plan is clear about its aims: It states that the goal is to increase the percentage of East Jerusalem Palestinian students who study the Israeli (versus the Palestinian) curriculum from 24 to 45 percent.19 

The plan’s funds are reportedly allocated as follows:20

  • NIS 736 million to improving roads and public transportation
  • NIS 55 million to other public infrastructure
  • NIS 209 million toward increasing employment, including NIS 50 million toward Hebrew language education to the Arab sector
  • NIS 48 million toward the encouragement of entrepreneurship, establishing start-ups, and helping residents find hi-tech jobs. This is likely to support large-scale development projects such as Silicon Wadi and EastTech that will displace hundreds of Palestinian businesses in downtown East Jerusalem, the only Palestinian-owned industrial area in that part of the city.21
  • NIS 133 million to building around 2,000 new apartments per year over the course of the five-year plan, ostensibly for Palestinians—who will benefit remains to be seen
  • NIS 100 million to health care
  • NIS 120 million to welfare
  • NIS 90 million to sustainability
  • NIS 415 million for public spaces
  • NIS 120 million for security—an increase following National Security Minister Itamar Ben-Gvir’s lobbying for increased police presence and manpower in the city
  • NIS 800 million to higher education preparatory programs

Palestinian Skepticism of the College Preparatory Programs

Al-Husseini said that while college preparatory programs for Palestinians have been branded as positive and may even have some benefits, overall they are detrimental to the Palestinian cause.

“It makes our life under occupation maybe less bad, but still worse,” al-Husseini said. “And it’s against our identity and our ambitions towards freedom and independence. [Israeli authorities] want us to always be in the lowest level of the socioeconomic hierarchy so that they can better control us.”

In this regard, he encourages students to reconsider before participating in such endeavors.

“Don’t look at the marketing. Go deeper and look what is behind this,” al-Husseini said. “If it’s only helping in continuing to make us servants in the Israeli economy, then we have to think twice.”



Nir Hasson and Tali Heruti-Sover, “Israeli Government Approves $850m Plan to Further Develop East Jerusalem,” Haaretz, August 20, 2023; “Cabinet Approves NIS 3.2 Billion Development Plan for East Jerusalem,” Times of Israel, August 20, 2023.


 “Israel’s Cabinet Approves $843m for Eastern Jerusalem,” Jewish News Advocate, August 20, 2023.


Gianluca Pacchiani, “In Latest Cut to Arab Funds, Smotrich Freezes Money for Integration in Academia,” Times of Israel, August 7, 2023.


Shira Kadari-Ovadia, “Israeli Education Ministry Backs Down on East Jerusalem Program after Far-Right Minister Freezes Funds,” Haaretz, August 8, 2023; JPost Editorial, “Netanyahu, Release the Funds for Israel’s Arab Community—Editorial,” Jerusalem Post, August 8, 2023, updated August 9, 2023.


Bezalel Smotrich, “Yesterday, the media published two budget decisions that I received as finance minister” [in Hebrew], Facebook, August 7, 2023.


Herb Keinon, “Israel’s Coalition and Opposition Are United against Bezalel Smotrich,” Jerusalem Post, August 11, 2023.


Kadari-Ovadia, “Israeli Education Ministry Backs Down.”


Nir Hasson, “Israel’s Finance Minister Gave Fatah and Hamas a Tremendous Gift,Haaretz, August 10, 2023; JPost Editorial, “Netanyahu”; Keinon, “Israel’s Coalition.”


Gianluca Pacchiani, “College Head Assails Smotrich for Defunding Programs for East Jerusalem Palestinians,” Times of Israel, August 14, 2023.


Hasson, “Israel’s Finance Minister”; Keinon, “Israel’s Coalition.”


Troy O. Fritzhand, “East Jerusalem Funding: Cabinet Set to Vote on Sunday,” Jerusalem Post, August 19, 2023, updated August 20, 2023.


Jonathan Nis and Nir Hasson, “How Netanyahu Rescued Smotrich from His Extremist Plan to Freeze Arab Funding,” Haaretz, August 10, 2023.


Hasson and Heruti-Sover, “Israeli Government Approves $850m.”


Interview with the author, August 2023. All subsequent quotations by al-Husseini are from this interview.


Zena Al Tahhan, “Settlers Attack Palestinians in Huwara amid Israeli Army Presence,” Al Jazeera, March 28, 2023. 


Hasson, “Israel No Longer Ignores East Jerusalem.”


Hasson and Heruti-Sover, “Israeli Government Approves $850m.”


Troy O. Fritzhand, “Gov’t Approves 3B. for Public Infrastructure, Education in East Jerusalem,” Jerusalem Post, August 20, 2023, updated August 21, 2023.


 Tzvi Joffre, “200 East Jerusalem Businesses to Be Demolished for ‘Silicon Wadi,’” Jerusalem Post, June 2, 2020.

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