Why the UK and US have pulled funding for UN aid agency in Gaza

The UK, US, and seven other countries have pulled crucial funding for the United Nations aid agency for Palestinian refugees after Israel claimed several of its staff members were involved in the deadly October 7 Hamas attacks.

Germany, Italy, the Netherlands, Switzerland, Finland, Australia, and Canada all joined the UK and US in pausing funding for the agency, which has become a crucial source of support for the people of Gaza since 1949.

UN Secretary-General António Guterres confirmed in a statement on Sunday that 12 UNRWA staff members were at the centre of the allegations – nine of whom had now been fired. One staffer has died dead and the identities of the other two are still being clarified, he said.

Announcing it was pulling funding, the US State Department said it was “extremely troubled” by the claims, while Business Secretary, Kemi Badenoch said it was quite right that the UK Government had suspended its own funding.

What does the UN agency provide for refugees on the Gaza Strip?

The UNRWA is the biggest aid agency operating in Gaza, with more than two million relying on its services. Formed in 1949, it employs some 13,000 people who provide urgent humanitarian aid, including healthcare and education, across the West Bank, in neighbouring Jordan, Lebanon, and Syria.

The agency has also provided shelter to hundreds and thousands of refugees since the outbreak of the conflict after Hamas’ October 7 attacks last year.

An estimated two-thirds of Gaza’s 2.3 million population receive help from the organisation which has played an even greater role in the region since the outbreak of the conflict.

Just last week the organisation warned its capacity to provide humanitarian aid to the people of Gaza was on the verge of collapse as Israel continued its bombardment of the West Bank.

According to the agency, at least 152 of its staffers have been killed in Gaza since Israel began its retaliation against Hamas after October 7.

What has Israel alleged?

Mark Regev, an adviser to Israel Prime Minister Benjamin Netanyahu, on Friday told the BBC that “people who are on their [UNRWA] salaries” were involved in Hamas’s October 7 attack on Israel.

Mr Regev said there was information showing teachers working in UNRWA schools had also “openly celebrated” the 7 October attacks and claimed a former Israeli hostage said she was “held in the house of someone who worked for UNRWA”.

“They have a union which is controlled by Hamas and I think it’s high time that the UN investigated these links between UNRWA and Hamas,” he said.

Israeli foreign minister Israel Katz has continued to call for donors to suspend funding, calling for the UNRWA to be replaced once the conflict in the region comes to an end.

“The leadership of UNRWA should be dismissed and thoroughly investigated for their knowledge of these activities. In Gaza’s rebuilding, UNRWA must be replaced with agencies dedicated to genuine peace and development,” Mr Katz said in a post on X, formerly Twitter.

The allegations prompted the UK Foreign Office to issue a a statement: “The UK is appalled by allegations that UNRWA staff were involved in the 7 October attack against Israel, a heinous act of terrorism that the UK Government has repeatedly condemned.”

“The UK is temporarily pausing any future funding of UNWRA whilst we review these concerning allegations,” it added.

How has the UN agency responded to Israel’s accusations?

Amid the accusations, the head of the agency, Philippe Lazzarini, labelled the decision to withdraw funding as “shocking”, and urged leaders to reconsider as people on the strip depend on the agency “for their sheer survival”.

In a statement Saturday night Mr Lazzarini urged countries who suspended their funding to reconsider before UNRWA was forced to suspend its humanitarian aid.

“These decisions threaten our ongoing humanitarian work across the region including and especially in the Gaza Strip,” he said, adding: “The lives of people in Gaza depend on this support and so does regional stability.

“It is shocking to see a suspension of funds to the Agency in reaction to allegations against a small group of staff, especially given the immediate action that UNRWA took by terminating their contracts and asking for a transparent independent investigation.”

Mr Lazzarini continued: “UNRWA is the primary humanitarian agency in Gaza, with over 2 million people depending on it for their sheer survival.   Many are hungry as the clock is ticking towards a looming famine. The Agency runs shelters for over one million people and provides food and primary healthcare even at the height of the hostilities. 

The agency head said cooperation was needed with international partners for the UNRWA to provide proper humanitarian assistance in Gaza – warning it could collapse “anytime now due to lack of funding. ”

“It would be immensely irresponsible to sanction an Agency and an entire community it serves because of allegations of criminal acts against some individuals, especially at a time of war, displacement and political crises in the region. 

Lazzarini said the UNRWA shares a list of all its staff with host countries every year and has never received any concerns over specific members. An investigation by the UN’s Office for Internal Oversight Services would “establish the facts” of the “heinous allegations”.

Meanwhile UN Secretary-General Antonio Guterres said: “Any UN employee involved in acts of terror will be held accountable, including through criminal prosecution.”

Mr Guterres confirmed an independent review was underway and asked countries to still provide financial assistance to the agency.

“The abhorrent alleged acts of these staff members must have consequences,” he added. “But the tens of thousands of men and women who work for UNRWA, many in some of the most dangerous situations for humanitarian workers, should not be penalised.

“The dire needs of the desperate populations they serve must be met.”