Every Israeli settlement in the West Bank, including those that are relatively well-off, is entitled to receive a "balancing grant" from the Interior Ministry to help it balance its budget, even though such grants mainly exist to help less well-off communities.

Open gallery view Construction work in Elazar, a settlement in the Gush Etzion bloc, in July 2010. Credit: AP

Moreover, the ministry allocated NIS 265 million in balancing grants to West Bank settlements in 2009, just over 10 percent of all the grants it distributed that year. As a result, each settler received NIS 115 on average - some 22 percent more than the NIS 94 per person allotted to towns within the Green Line that received such grants.

The two West Bank regional councils that received the largest per capita grants were the South Hebron Hills council, at NIS 288 per person, and the Jordan Valley council, at NIS 275 per person. Among individual settlements, those receiving particularly generous per capita grants included Immanuel (NIS 258 ), Kedumim (NIS 182 ), Kiryat Arba (NIS 150 ) and Beit El (NIS 141 ).

More prosperous settlements received lower per capita allotments. In the Gush Etzion bloc, for instance, the figure stood at just NIS 84, while in Har Adar it was a mere NIS 3 per person.

Altogether, the ministry distributed NIS 2.5 billion worth of balancing grants last year. No money is given to well-off towns, like Tel Aviv, which have sizable revenues of their own; the grants are meant to help less prosperous communities supply a basic level of service to their residents. But in practice, most Israeli towns run deficits and are therefore entitled to these grants.

How much money each town receives depends on various criteria, including the town's revenues, expenses, number of residents and pension liabilities. Towns must also meet certain tax collection targets to qualify.

However, the rules grant an edge to West Bank settlements and front-line communities within Israel, mainly those near the Lebanese and Gazan borders, which are considered to have higher security expenses: These towns' expenditures are automatically inflated by 4 percent, entitling them to larger grants.

In response, a ministry spokeswoman noted that the Gadish Committee - the public committee that devised the current formula for awarding the grants - explicitly recommended that preference be given to front-line communities in Israel and the West Bank, and the cabinet adopted its recommendations back in 2003. But beyond this built-in preference, she said, settlements enjoy no special privileges in terms of grant allocations.