Exclusive: US, UN clash over beleaguered Palestinian refugee agency

Secretary-General António Guterres has urged the heads of the United Nations’ principal relief agencies, including the World Food Programme and UNICEF, to rebuff appeals by Israel and the United States to undertake work currently carried out by the world body’s beleaguered Palestinian refugee agency. The outreach pits Guterres against the Biden administration, which is mounting a campaign to persuade the U.N.’s main relief organizations to take over some of the functions of the U.N. Relief and Works Agency for Palestine Refugees in the Near East, or UNRWA, the decades-old Palestinian aid agency that Israel has accused of complicity in Hamas’ crimes, reflecting concerns that its financial future is endangered. The effort is being led by U.S. Special Envoy for Middle East Humanitarian Issues David Satterfield and supported by the State Department and the U.S. Agency for International Development. As part of that, the U.S. government has underscored the importance of UNRWA, while pressing other U.N. agencies to take on a broader role in delivering assistance in Gaza, reflecting concern that Congress will halt hundreds of millions in aid each year to the Palestinian refugees. A Ukraine/Israel aid bill that passed the Senate included a provision prohibiting U.S. financial assistance for UNRWA. The Republican-controlled House, however, has signaled opposition to the bill. “State/USAID [are] very clear that Congress will never fund UNRWA again and are asking UNICEF, WFP and WHO to step in,” one humanitarian relief expert tracking the discussions texted Devex. “Guterres firmly opposes agencies taking over UNRWA functions.” Guterres has privately urged the heads of U.N. agencies to rally behind UNRWA and not take any steps that could erode its position, including by accepting donations and conducting contingency planning for a possible expansion of their activities in Gaza, or by poaching any of the thousands of Palestinian workers under contract with UNRWA, according to two well-placed sources. Asked to comment on those claims, a spokesperson for the U.N. chief referred Dexex to Guterres’ public statements on the matter. In public, Guterres has voiced concern that weakening UNRWA in the midst of one of the world’s worst humanitarian tragedies would worsen the suffering of Palestinian civilians. UNRWA, in Guterres’ view, is the only organization with the operational wherewithal to confront one of the world’s worst humanitarian crises. “There are 3,000 Gaza staff members that are the backbone of the humanitarian distribution inside Gaza,” Guterres recently told reporters. “No other organization has a meaningful presence inside Gaza.” The U.S. call for new U.N. agencies to shoulder a greater burden in Gaza follows demands by Israel’s Prime Minister Benjamin Netanyahu, and U.S. lawmakers, to terminate UNRWA, claiming the agency is “infiltrated” by Hamas. U.N. officials counter that substituting the Palestinian refugee agency will simply result in UNRWA’s current staff signing up for work with WFP or UNICEF at far higher salaries. “To me the absurdity is that they are basically trying to stitch new decals on a car, but it’s the same car, the same driver, going to the same place,” said one senior U.N. official. Palestinian state UNRWA was established in 1949 by the U.N. General Assembly to provide assistance to more than 700,000 Palestinians displaced during the 1948 Arab-Israeli war, and currently provides education, health care, and other basic services to more than 5 million Palestinians, mostly descendants of the original refugees, in Gaza, the West Bank, Lebanon, Syria, and Jordan. It employs more than 30,000 nationals, most of them teachers, including some 13,000 in Gaza, though fewer than 3,000 are currently delivering aid there. Israeli politicians have long resented the 75-year-old agency, which they believe perpetuates the Israeli-Palestinian conflict by keeping a spotlight on the unresolved plight of the refugees, relieving neighboring states of the burden of integrating them into their societies and preserving the illusion that they will have a right of return to their ancestral homes in Israel. For its part, the U.N. maintains that the fate of Palestinians can only be resolved through a comprehensive peace deal that results in the creation of a Palestinian state. Israel, according to Philippe Lazzarini, UNRWA’s commissioner general, is undertaking a targeted campaign to dismantle the organization, which predates that latest round of violence. “There is a much broader political objective based on the idea that if the agency is eliminated, the issue of the status of Palestinian refugees can be permanently solved,” Lazzarini said in an interview with the Swiss newspaper Le Temps, which was translated by Geneva Solutions. “However, the status of these refugees is not linked to the organization’s existence as it is enshrined in a UN General Assembly resolution. This status will remain until a political solution is found.” For the moment, the humanitarian relief campaign is largely theoretical. U.N. agencies are constrained from delivering aid as Israel has intensified its military campaign in Rafah, where the vast majority of Gazans, more than 1.5 million, are sheltered. The conflict has also prevented the majority of UNRWA workers — including teachers and primary care providers — from working at all. More than 150 UNRWA workers have been killed in the Israel offensive. Still, the debate on the future of UNRWA is sharpening just weeks after Israel claimed that a dozen Palestinian employees of the organization participated in Hamas’ Oct. 7 raid in southern Israel killing some 1,200 people, mostly civilians, and capturing about 250 hostages, according to Israeli authorities. Some 100 are still in captivity. Israel’s counteroffensive has resulted in the deaths of more than 28,000 Palestinians and driven the population of more than 2 million people to the brink of famine. The U.N. responded quickly to the allegations, firing nine of the alleged perpetrators — two have been declared dead, and one is unaccounted for — and announcing plans to carry out a pair of internal investigations to get to the bottom of what happened. The U.S., meanwhile, and several other donors, including Germany, the United Kingdom, Japan, and the Netherlands, announced pauses on new contributions to the aid agency, pending the results of the U.N. inquiries. “There have always been, and still are, voices in the Israeli military that if you take UNRWA away, Israel is likely to get stuck with the bill.” --— Hussein Ibish, senior resident scholar, Arab Gulf States Institute During the war, Israel has ramped up its longstanding calls for dismantling the U.N. relief outfit, even as many in the Israeli national security establishment grudgingly acknowledge its importance, reflecting concern that the elimination of UNRWA would shift the legal burden of caring for Gazans to Israel. But hardliners in the Israeli government have sought to force the matter. Israeli Finance Minister Bezalel Smotrich, a far-right nationalist from the settler movement, recently blocked the delivery of U.S.-funded flour to Gaza because it would be delivered by UNRWA, according to Axios. “Israeli officials said they are now trying to reroute the shipment so that it would enter Gaza through the World Food Program in order for Smotrich to release the hold,” according to Axios. The Biden administration, which had restored hundreds of millions of dollars in UNRWA funds blocked by the Trump administration, defended UNRWA as a critical source of stability in the region. “There is no other humanitarian player in Gaza who can provide food and water and medicine at the scale that UNRWA does,” Matthew Miller, U.S. Department of State spokesperson, said at a briefing on Jan. 30. “We want to see that work continued, which is why it is so important that the U.N. take this matter seriously.” He noted that the U.S. has already allocated $121 million in the fiscal year to UNRWA so only $300,000 has been suspended. Still, the U.S. is exploring the idea of redirecting that aid to other U.N. agencies. The U.S. policy shift reflects a growing acknowledgment that decades of U.S. financial support for UNRWA — paused for a brief period during Trump’s presidency — is coming to an end, and that Congress is forcing the administration to find other ways to channel U.S. financial assistance to Palestinian civilians. The State Department announced earlier this month that it would redirect funds previously earmarked for UNRWA to WFP, UNICEF, and other NGOs. “We of course want to be able to continue supporting the important work that is happening in Gaza through partners like the World Food Programme, UNICEF, and other NGOs,” Vedant Patel, the principal deputy state department spokesperson, told reporters on Feb. 5. “We have not been naive about how critical we think UNRWA is both in Gaza, but also the region broadly, and the critical work they do to aid and get aid to Palestinian civilians.” Shifting the role to other agencies is likely to increase the overall costs of assistance. UNRWA — which aligns its staff salaries with those of local civil servants — pays a fraction of what other U.N. agencies pay local staff. Guterres and heads of humanitarian aid agencies have urged donors to reconsider, saying the humanitarian costs of an aid freeze are too high. “Decisions by various Member States to pause funds from UNRWA will have catastrophic consequences for the people of Gaza,” according to a Jan. 30 statement by the heads of U.N. and private relief agencies. “No entity has the capacity to deliver the scale and breadth of assistance to 2.2 million people in Gaza urgently need.” “The costs with the UNRWA are much lower than the costs with the other agencies for historical reasons,” Guterres told reporters at a Feb. 8 press conference. “The salary … paid by UNRWA are one third of the salaries paid by UNICEF or WFP or other U.N. organizations.” In Washington, Republican lawmakers have echoed Israel’s calls for dissolving UNRWA, introducing a raft of legislation that would cut the more than $300 million the U.S. provides to the agency, more than any other country. But Democrats have also targeted UNRWA. Brad Schneider, a Democratic representative for Illinois, introduced the Replace UNRWA for Palestinian Aid Act of 2024. The dispute has placed the heads of U.N. agencies in a bind. WFP, led by Executive Director Cindy McCain, has indicated a willingness to try to accommodate the U.S. appeal to broaden its role but has informed the U.S. that it is constrained by the guidance coming from the U.N. chief’s office, according to two well-placed officials. “The World Food Programme’s mandate is to deliver food assistance to hungry and vulnerable people,” a spokesperson for WFP told Devex by email. “We are ready to further step up our food assistance in Gaza, with the necessary funding. We cannot replace the critical functions of UNRWA in Gaza, including the running of shelters and health clinics.” Catherine Russell, the executive director of UNICEF, met with Democratic Senator Chris Coons and other lawmakers to discuss how the children’s aid agency might enhance its humanitarian efforts in Gaza, as well as Sudan. “The issue of providing aid was discussed but no request was made,” a UNICEF spokesperson told Devex by email. But Russell drove home the point that no one can fill UNRWA’s shoes. “No other UN or humanitarian organization has the capacity to deliver the urgent assistance that 2.2 million people in Gaza urgently need.” “With almost a million children displaced, with disease spreading due to unsanitary conditions and lack of clean water, and with Gaza facing the risk of famine, we should be rapidly scaling up the humanitarian response, not down,” the spokesperson added. Hussein Ibish, senior resident scholar at the Arab Gulf States Institute in Washington, said there is no easy way out of the current humanitarian crisis, and that at the end of the day, Israel and its American allies will have to come to terms with a future that includes a central role for UNRWA. “There have always been, and still are, voices in the Israeli military that if you take UNRWA away, Israel is likely to get stuck with the bill,” Ibish told Devex. “I think [UNRWA] will weather it because of the lack of an alternative. But it’s the biggest crisis in the history of the organization.”