Listening closely to European diplomats these days means realizing how fed-up the European Union is with the Israeli-Palestinian issue and its cost for taxpayers.

Beneath the polished diplomatic rhetoric, officials are wondering rather loudly why Europe must continue bankrolling an endless, decades-old conflict while other, more burning crises are unfolding one after the other in the Arab Middle East. The vision of a two-state solution — the original reason for the funding — is drifting ever further away, they note.

The most striking example of this attitude emerged in Brussels Wednesday, when the European Court of Auditors presented its assessment of the EU’s direct financial support to the Palestinian Authority. The 70-page report was a scathing critique of an increasingly dysfunctional, over-sized Palestinian Authority.

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Sure, Israel is greatly to blame for the Palestinian economic stagnation, the report notes, but why should thousands of PA civil servants in Gaza receive EU-funded salaries while sitting at home, as their leadership pretends the rift with Hamas will end any day?

Europe feels it has been doling out billions of euros in aid to the Palestinian Authority with no mechanism of checking its impact or benefit

“When people who do not work are being paid, this goes against the agreement with Pegase,” noted Hans Gustaf Wessberg, the Swedish head of the auditors’ team, referring to the European Direct Financial support scheme for Palestinian salaries. “The resources spent there [in Gaza] are better spent elsewhere.”

But stopping funding for Gaza may just be a prelude to much broader measures. European officials have been mulling the possibility of cutting funding to the PA altogether if talks between Israel and the Palestinians fail to bring about tangible results. This is a possibility not all officials like mentioning; some prefer to present the cup half full: Europe will significantly increase funding if talks succeed, one diplomat said.

A key word in the new European report is “conditionality.” Europe feels it has been doling out billions of euros in aid to the Palestinian Authority with no mechanism of checking its impact or benefit. That, it seems, is about to change; Europe will demand more accountability from the Palestinian Authority and stop treating the Fatah-Hamas schism as a temporary situation.

Where does all this leave Israel? Potentially, in a precarious situation. The collapse of the Palestinian Authority for lack of funding would — in the best-case scenario — increase the pressure on Israel to retake financial and security control of the West Bank; control which it began handing over to the PA in 1994. In the worst case, the West Bank could swing into political disarray, which may potentially spill over into Israel.

That is why, in the opinion of Palestinian political scientist Basem Ezbidi of Bir Zeit University, Europe (and Israel) would never dare cut funding to the PA.

“Nobody can really afford to see Palestinians reach that point of despair,” Ezbidi told The Times of Israel. Neither Israel nor the EU need “a headache of that magnitude.”

Rather, the point of the European threats, Ezbidi claimed, is to keep the Palestinians at the negotiating table at a point in time when their withdrawal seems imminent.

“The Palestinians sense they are not succeeding in getting anything from the negotiations… There is a sense of anger on the part of the PA.”

Back in Brussels, sympathy for the Palestinian cause has not translated into substantive political action against Israel — at least not yet.

Israel’s prestigious association agreement with the EU, signed in the year 2000, is as safe as ever. But new European guidelines barring cooperation with Israeli entities that have ties beyond the Green Line are set to take effect next month.

Despite those guidelines, in late November Israel was included in the lucrative scientific cooperation deal Horizon 2020, which promises European funding to numerous Israeli research projects. The deal was held up because of the new guidelines, but a compromise agreement was ultimately reached.

It’s not clear yet how other Israeli entities will be affected by the new guidelines, which prompted an outpouring of anger by government officials. For her part, however, one pro-Palestinian European parliamentarian, speaking to Israeli journalists visiting Brussels last week, voiced her frustration at what she deemed was manifest EU bias in favor of Israel over the Palestinians.

“There’s huge inequality between the capacity of Israeli officials to come here, talk with people, and interfere, and the capacity of Palestinian Authority officials to do the same,” she argued. “It’s 90 percent for the Israelis and 10 for the Palestinians.”