The government spent NIS 1.1 billion on West Bank settlements last year, and could save at least that much if it were to make its spending proportionate to the number of Israelis who live in the settlements, according to two different reports made public this week.

Last year's government spending on the settlements represents a 38 percent rise over that of 2010. But it is significantly lower than the peak of NIS 2.5 billion (in real terms ) in 1993, when the funds were geared toward infrastructure changes required by the Oslo Accords, according to Central Bureau of Statistics findings reported on Monday by Israeli business newspaper Calcalist.

The report was prepared for U.S. officials to enable them to deduct the annual settlement expenditure from U.S. loan guarantees to Israel. In 2003 Israel stopped granting tax breaks to citizens seeking to move to the West Bank, after pledging to the United States that it would bring the benefits to an end.

In the second report, which also examines the cost of the settlements and is scheduled to be released to the public on Wednesday, Peace Now states that Israel could save NIS 1.6 billion a year if it were to match the level of government expenditure on services such as education and infrastructure in the settlements with the number of people who live there.

"If the government would just make per capita spending for residents of the settlements equal to spending for the rest of the country's citizens, we would be able to cancel the widespread [budget] cuts and significantly reduce tax increases," said Peace Now head Yariv Oppenheimer.