The mood inside UNWRA as workers fear financial collapse

A potential collapse of the United Nations agency for Palestinian refugees, which would upend health care, education, and relief for millions in Gaza and the West Bank, is becoming an increasing prospect, according to current and former agency officials. Created as a temporary agency more than 75 years ago in the wake of the creation of Israel and its forced displacement of an estimated 700,000 Palestinians, the United Nations Relief and Works Agency for Palestine Refugees in the Near East, or UNRWA, is facing a particularly dire situation amid a funding crisis, Israeli restrictions, and in the context of U.N. reform. The agency’s commissioner-general, Philippe Lazzarini, has stepped up his pleas for financial and political support to the international community in the last months, describing the existence of the agency responsible for nearly 6 million registered Palestinian refugees as shaky and its financial situation as “disastrous.” “I also implore you to safeguard UNRWA’s mandate within a time-bound political process, and to finance the provision of essential services until that process is complete,” he said on the sidelines of the 80th U.N. General Assembly on Sept. 25. A U.N. report published in June as part of the UN80 reform warned the 30,000-strong agency for Palestinians was facing “unprecedented challenge” to its very existence, including “the possibility of a disorderly collapse” over financial issues and Israel’s “systematic effort to dismantle” UNRWA’s presence in the occupied Palestinian territories. The uncertainty comes at a time when Palestinian refugees are acutely vulnerable. After the bloody Oct. 7, 2023, Hamas attack on southern Israel, Israeli military operations and restrictions on food and humanitarian supplies — deemed by an independent U.N. commission as a genocide — have resulted in more than 67,000 deaths in Gaza, the displacement of millions, and damage and destruction of more than 90% of residential buildings. The occupied West Bank has also faced an uptick in Israeli settler violence, the expansion of illegal settlements, and large population displacement from military operations “Collapse is certainly an option; it’s a high likelihood if this whole funding model continues,” said Juliette Touma, UNRWA director of communications. “We don’t know what will happen beyond October.” Three other current UNRWA officials and one who left recently also shared concerns that the agency was facing particularly extraordinary difficulties. They spoke anonymously to Devex because they were not allowed to speak publicly about internal affairs, and for safety reasons. Unlike most U.N. agencies, UNRWA largely depends on voluntary contributions — and has faced immense and frequent financial tensions and regular challenges operating in the occupied Palestinian territories since its creation. The United States already cut its funding to UNRWA between 2018 and 2021 under President Donald Trump’s first mandate. But obstacles have grown since the Oct. 7 attack and Israeli authorities’ ensuing campaign against the agency it accused of complicity with the militant Palestinian movement. Despite U.N. investigations largely refuting such allegations, the agency had its funding from the U.S. revoked and has faced an onslaught of limitations and violence against its staff members in Gaza and the occupied West Bank. In April, Lazzarini said more than 50 UNRWA staff members had been arrested since the current conflict began. Israel started applying this year a law banning UNRWA's activity on Israeli soil and prohibiting any contact between Israeli officials with the agency, stopping international staff from entering Palestinian territories, and shutting down six schools in East Jerusalem in May. Supplies for Gaza, including the equivalent of 6,000 trucks of medicine and food, have also been blocked from entering since March, according to Lazzarini. “Israel is trying to strangle our supply line so that we can’t implement our mandate,” said one current official of UNRWA. “Israel has wanted for years to shut us down, and they’re very close to doing it.” More than 360 UNRWA staff have also been killed — a record death toll for a U.N. agency — and most UNRWA schools and clinics in Gaza have been damaged or destroyed since the start of the Israeli bombardments, according to the U.N. The Israeli Government Press Office contact for English-speaking international media sent an automatic reply that the office was on holiday between Oct. 1 and 15. The director of the government press office did not reply in time for publication. Meanwhile, funding from member states has dwindled this year, even from vocal supporters of Palestinian refugees. Arab states in the Gulf provided 3% of total contributions to UNRWA in 2025, a 90% drop from 2024, according to Lazzarani. The situation is exacerbated by broader cuts in humanitarian and development aid from some of the largest and historical international donors. In December 2024, Sweden also cut its funding for UNRWA over concerns the agency would not be able to channel aid to Palestinians. It transferred it instead to other U.N. organizations and NGOs, including the World Food Programme, UNICEF, and the International Committee of the Red Cross. UNRWA says it is currently carrying out its operations as best it can, but it’s unclear how long it will be able to do so. “Many of the UNRWA staff in Jerusalem and West Bank are looking for jobs because the prospect of job safety is very dark right now,” said one former official who recently left. It’s also unclear which operations would be the first to shut down if the agency doesn’t receive sufficient funding in the coming weeks and months and if risks and restrictions continue or escalate. Some officials suggested to Devex that activities in countries hosting Palestinian refugees, such as Jordan, might be the first to be scaled back. Others warned that activities in the occupied Palestinian territories and host countries — such as clinics providing care and vaccination, and some of the over 700 schools teaching half a million children — could be forced to close. Even if the agency survives in the coming months, some officials have been further alarmed by a U.N. report about UNRWA’s future as part of the UN80 reform. Scenarios included scaling down the operations of the agency or transferring some services to other agencies and governments, ideas seen by some UNRWA officials as financially unsound, chaotic, and inefficient. “No other UN agencies or NGO does the work that UNRWA does: UNICEF doesn’t run schools, WHO doesn’t run clinics and have their own doctors or nurses,” Touma said. While only a reform to UNRWA’s funding model would make the agency more sustainable in the long run, Lex Takkenberg, a UNRWA former official for 30 years, also underlined the importance of the recently announced U.S.-led peace plan for Gaza and whether it will counter Israeli authorities’ restrictions on the U.N. agency. “In the Trump plan, aid will be stepped up through the United Nations again, and in Gaza, the United Nations is UNRWA,” said Takkenberg, who is currently a senior adviser with the NGO Arab Renaissance for Democracy and Development. “It is critical that the international community keeps UNRWA afloat in this very difficult period, because it will necessarily be the backbone for a broader social services system in Gaza.”