The Dutch Foreign Ministry says it will implement "sweeping reforms" to prevent the transfer of millions of taxpayer euros from going to Dutch humanitarian aid organizations that fund anti-Israel boycott, divestment and sanctions (BDS) activities and non-government organizations (NGOs) that deny Israel's right to exist.

The move comes after Dutch Foreign Minister Uri Rosenthal discovered that previous governments had allocated at least €10 million ($15 million) to Dutch and Palestinian groups promoting BDS activities against Israel.

Debate over the issue heated up on June 15, when the heads of major Dutch NGOs were asked to testify at a special hearing convened by the Dutch Parliament "to discuss the activity of NGOs in Israel and Palestine."

According to a transcript of the event obtained by the Jerusalem Post, lawmakers heard the managers of leading Dutch NGOs defend BDS activities against Israel, as well as advocacy for a "one-state solution" for the Israeli-Palestinian conflict.

During questioning, the director of the Hague-based Catholic Organization for Relief and Development Aid (Cordaid), René Grotenhuis, defended BDS as "legitimate" because "it is important that people in Palestine look for ways to resist occupation, and it is a nonviolent way to do so."

The director of the Utrecht-based Interchurch Organization for Development Cooperation (ICCO), Marinus Verweij, said he believes that "the two-state solution is not the basic assumption for peace."

At the hearing, it also emerged that Oxfam Novib, the Dutch affiliate of Oxfam International, provided funds to the Dutch NGO "Stop de Bezeting" (Stop the Occupation). The group's founder, the anti-Israel activist Greta Duisenberg, is famous for her participation in demonstrations calling for Jews to be gassed. She has also accused the Israelis of blood libel and trafficking in human organs.

After the hearing ended, Johan Driesen of the Dutch Freedom Party said: "It was the first time I sat down to talk with the directors of the aid groups and I found what they said not only surprising, but disgusting. And I think the Dutch government should cut funding to organizations promoting this agenda."

The scale of the problem has been documented by the Jerusalem-based NGO Monitor in a new report titled "Indirect Dutch Government Funding: ICCO and Cordaid Support for Radical NGOs." The study shows that the Dutch government grants hundreds of millions of euros each year to major Dutch aid organizations such as ICCO and Cordaid, and that these groups then transfer the funds to support some of the most radical NGOs active in the Arab-Israeli conflict.

As a result, Dutch taxpayers are unknowingly funding anti-Zionist groups that promote BDS activities against Israel, including: BADIL, Coalition of Women for Peace, Defence for Children International –Palestine Section (DCI-PS), Holy Land Trust, Sabeel, Stop the Wall, and the Ma'an Development Center.

Several of these groups are currently organizing a pro-Palestinian "consciousness-raising event" (here and here) to be held in Israel in early July. Part of a propaganda effort aimed at delegitimizing the state of Israel, activists from across Europe plan to arrive at the Ben Gurion Airport in Tel Aviv on July 8, and from there move on to Judea and Samaria for a week of solidarity with the Palestinians. They have chosen July 8 because the following day marks the anniversary of the day (July 9, 2004) that the International Court of Justice in The Hague declared the Israel security barrier to be illegal.

According to another NGO Monitor report, Dutch taxpayers are also funding Electronic Intifada (EI), a website that publishes articles that compare Israelis to Nazis and promotes campaigns for anti-Israel BDS activities. EI is being financed by ICCO, the Dutch NGO, which receives 90 percent of its budget from the Dutch government.

As documented by NGO Monitor, EI plays a central role in the Durban strategy of political warfare against Israel, with frequent accusations of "apartheid," "ethnic cleansing" and "slow genocide." Articles on the EI website justify violence against civilians, call Gaza a "concentration camp" and label Palestinian participation in peace talks as "collaboration." EI also has extensive sections (here and here) supporting the BDS movement against Israel.

The ICCO website devotes an entire page to Electronic Intifada, praising its work as "an internationally recognized daily news source" that provides a counterweight to "positive reporting" about Israel. ICCO's website notes its three-year funding pledge for EI. During his testimony to parliament, ICCO director Verweij called EI "an important source of information" and said "in no way is the EI anti-Israel or anti-Semitic."

According to NGO Monitor, groups such as "ICCO and Cordaid do not systematically provide information regarding funding to local NGOs. Full lists of partners and projects are not publically available. There does not appear to be government oversight or evaluation of the indirect Dutch funding for NGOs, or of ICCO's and Cordaid's decision making."

In response to the revelations, Foreign Minister Rosenthal promised to "look into the matter personally. If it appears that the government-subsidized NGO ICCO does fund Electronic Intifada, it will have a serious problem with me."

Rosenthal has also told the Hague-based Center for Information and Documentation on Israel (CIDI) that he will intervene to block funding to groups promoting the BDS campaign. "A meticulous reappraisal of subsidy applicants remains necessary. Intervention will occur in cases of organizations acting against Dutch policy," Rosenthal said.

Dutch aid groups are now feeling the heat. The Dutch government has reduced the amount of financial support it provides to Cordaid this year by a whopping 42 percent, forcing the organization to fire one-third if its 400 workers. Oxfam-Novib has seen its budget slashed by one quarter, prompting it to close down its operations in Latin America and Central Asia. ICCO has lost more than one-third of its government subsidies in 2011.

Meanwhile, Deputy Prime Minister Maxime Verhagen set out the Dutch government's new plans to strengthen political and economic relations with Israel. In a June 14 speech at the Technion in Haifa, Verhagen also announced the inauguration of the Dutch-Israeli Cooperation Council by January 2012. Invest rather than divest will be the new mantra.

Other moves also signal a sea-change in Dutch-Israeli relations. In April, the Dutch government cracked down on the Dutch affiliate of the Turkish group IHH – the main organizer of a planned flotilla to the Gaza Strip – because of its involvement with Hamas. The Dutch Foreign Ministry "placed IHH Netherlands on the Dutch list of terrorist organizations and froze its assets, because IHH Netherlands regularly transferred funds to IHH Germany. This organization is banned in Germany because it has raised funds for Hamas. Hamas has been on the EU list of terrorist organizations since 2003."

In February, members of the Dutch parliament approved a parliamentary decision in support of Israel as a "democratic Jewish state." The pro-Israel vote resulted in 113 of the 150 parliament members affirming Israel's existence as a Jewish state and urging the European Union not to recognize a unilaterally declared Palestinian state.