IMF: Rapid growth of bureaucracy plagues Palestinian Authority

RAMALLAH — The Palestinian Authority has been warned against its expanding bureaucracy in what appears to be a drive by officials to reduce unemployment in the West Bank and Gaza Strip.

A report by the International Monetary Fund and the PA said that in a six-month period more than 10,000 people were hired by the PA. They said this far exceeded the PA budget.

By the end of the year, the report said, the PA will have employed 112,500 peple and its payroll will have increased by nearly $60 million.

The PA hiring appears to be part of a drive to reduce unemployment. In the first quarter of this year, unemployment in PA areas was reported at 10.9 percent. During the same period last year, the rate was 13.9 percent.

The report accused the Finance Ministry of being unrestrained by the budget. "The rapid expansion in PA staff not only makes less resources available for other important recurrent and capital expenditure," the report said, "it also makes it exceedingly difficult to ensure adequate remuneration of PA employees."

The IMF has increased supervision of the PA as part of a demand by donor nations for continued aid to the Palestinians. The PA is requesting $40 billion to help establish a state and compensate Palestinian refugees.