Lebanon’s Parliament continues to finance Hezbollah fighters through a controversial law enacted in 2001, raising questions about State resources being channeled to the militant group amid a deepening economic crisis. While a portion of the Lebanese population pays taxes, Hezbollah benefits from State funds, offering privileges and financial support to its fighters. This arrangement dates back to a law passed in 2001 that grants compensation and pensions to prisoners and detainees held in Israeli jails.

Hezbollah’s institutional dominance began to take shape with the election of President Émile Lahoud in 1998, when Syria maintained firm control over Lebanon’s political system. The Syrian-backed government passed laws that facilitated Hezbollah’s growing influence, including financial allocations disguised as State support for southern Lebanon.

Following Israel’s withdrawal from southern Lebanon in May, 2000, Lahoud’s administration redirected State revenues toward Hezbollah’s base. Taxes, including military salary deductions and increased mechanical inspection fees, were introduced under the pretense of supporting the South, ultimately benefiting Hezbollah indirectly.

A key move in this strategy came in 2001, when Parliament, at Hezbollah’s request, approved a compensation law for detainees held in Israeli prisons or by the now-disbanded South Lebanon Army (SLA). The law remains in force to this day, placing a lasting financial burden on Lebanon’s treasury.

The law equated every prisoner held by Israel or the SLA with Lebanese Army personnel, granting them lifetime pensions or lump-sum compensation. This allowed Hezbollah to secure financial support for its fighters under the guise of State benefits.

Many of the so-called detainees had no direct involvement in Hezbollah’s military activities and were imprisoned for unrelated offenses such as drug trafficking and theft. Nevertheless, the State began allocating pensions and financial aid to a growing number of individuals, many of whom later joined Hezbollah’s ranks.

The situation escalated in 2008 when Hezbollah expanded its grip over State institutions, including the Ministry of Finance, ensuring that these payments continued. The law enabled Hezbollah fighters to receive State funds while operating outside the Lebanese Armed Forces' command structure.

The Details of the 2001 Law

Parliament passed the compensation law on August 16, 2001, and it was published in the official gazette two days later.

• Article 1 stipulates that prisoners held for one to three years are entitled to a lump-sum compensation of five million Lebanese pounds per year of detention. Those detained for less than a year receive half that amount.
• Article 2 grants detainees who served over three years the option of either a lump-sum payment or a pension of 400,000 Lebanese pounds per month. For each additional year beyond the three-year threshold, they receive half the value of the first-degree military rank increment.
• The law extends pension benefits to the families of deceased detainees and those who sustained disabilities during their imprisonment.
• Article 3 ensures that these pensions remain a personal right and are transferrable only to spouses and children, mirroring benefits granted to civil servants.

These benefits have remained in place despite Lebanon’s financial collapse and worsening fiscal deficit. Adjustments to the minimum wage and new salary scales for public employees have further expanded the financial drain on the treasury.

A Legislative Test for Parliament

Lebanon’s Parliament now faces growing calls to repeal the law, which critics argue has outlived its purpose and now serves as an indirect funding mechanism for Hezbollah. Since it was passed as legislation rather than a government decree, a new law would be required to nullify it.

With Hezbollah maintaining significant influence over State institutions, any attempt to repeal the law faces an uphill battle. However, international donors and reform advocates insist that Lebanon cannot move forward with financial recovery efforts while continuing to fund Hezbollah fighters under State protection.

The Lebanese public, already burdened by economic hardships, has grown increasingly wary of tax revenues being funneled into Hezbollah’s structures. The situation raises broader concerns about State legitimacy, as the Lebanese Armed Forces struggle to secure adequate funding while Hezbollah fighters receive government-backed pensions.

The sheer scale of financial resources allocated through this mechanism remains unclear, but estimates suggest thousands of beneficiaries continue to receive payouts. These payments have only increased over time due to inflation and salary adjustments, creating a growing fiscal liability.

Reform or Continued State Financing?

With Lebanon desperately seeking international aid and IMF support, financial transparency has become a key demand from donor States. Repealing the 2001 law would send a strong signal of reform, demonstrating a commitment to curbing State-backed financing for Hezbollah fighters.

Failure to act, however, risks exposing Lebanon to increased scrutiny and potential financial sanctions. Critics argue that the law has evolved into an unchecked vehicle for Hezbollah’s State-sanctioned funding and must be revoked if the government is serious about reforms.

As Lebanon’s Parliament weighs its options, the question remains: Will it take decisive action to end Hezbollah’s financial privileges, or will it allow the status quo to persist?

This is an English adaptation of an Arabic article published by Nidaa Al-Watan.