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The UN Palestinian refugee agency (UNRWA) calls the decision by the Trump administration to no longer commit funding “deeply regrettable” and “shocking”.

UNRWA Spokesman Chris Gunness said the move will affect “millions of people” including “some of the most disadvantaged and marginalised on this planet”.

For nearly 70 years, UNRWA has provided lifesaving assistance to more than five million Palestinian refugees in the occupied territories, Lebanon, Syria and Jordan.

Set up in 1949 to serve the needs of hundreds of thousands of Palestinians who were driven from their homes after the creation of Israel, the organisation has been providing refugees and their descendants with access to food, education, healthcare, social services and employment.

But over the past year, the US government has made it increasingly clear it considers the work the organisation does, and who it considers as refugees, to be an obstacle in the protracted Palestinian-Israeli conflict.

In January, a month after President Donald Trump’s decided to recognise Jerusalem as Israel’s capital, a move that prompted widespread international condemnation, the White House decided to cut $65m in aid to UNRWA.

It was later reported that the Trump administration had withheld about $305m in funding, and only delivered $60m to UNRWA.

UNRWA told Al Jazeera it spent the next eight months scrambling for financial assistance, and was only able to continue operating after $238m was raised, mainly due to to large contributions by Qatar, the United Arab Emirates and Saudi Arabia, which donated $150m between them.

But on Friday, the US announced it would stop all funding calling the UN agency an “irredeemably flawed operation”.

The decision was quickly criticised by the Palestinian leadership and a spokesman for UN Secretary-General Antonio Guterres pushed back against claims that the agency was inefficient.

“UNRWA has a strong record of providing high-quality education, health and other essential services, often in extremely difficult circumstances,” a statement by Stephane Dujarric read.

“The Secretary-General calls on other countries to help fill the remaining financial gap, so that UNRWA can continue to provide this vital assistance, as well as a sense of hope this vulnerable population.”

What is UNRWA?

Originally established as a temporary solution, UNRWA was set up after the creation of Israel in 1948 to assist the more than 700,000 Palestinians who were forcibly expelled from their towns and villages.

Since then, it has helped four generations of Palestinians with basic needs, including housing, healthcare, education and social services.

Employing more than 30,000 staff, it mostly works in education, and operates closely with local government bodies.

It helps more than half of Gaza’s two million population, a region which has been devastated by more than 10 years of blockade.

According to UNRWA, the strip suffers from a 44 percent unemployment rate.

Gunness, the agency’s spokesman, told Al Jazeera that if UNRWA didn’t receive emergency funding in the next 30 days, when its funds are expected to run dry, a “doomsday scenario” could unfold.

“Let there be no mistake this decision is likely to have a devastating impact on the lives of 526,000 children who receive a daily education from UNRWA, 3.5 million sick people who come to our clinics for medical care, 1.7 million food insecure people who receive assistance from us, and tens of thousands of vulnerable women, children and disabled refugees who come to us.

“If we don’t fill a funding gap of $217m very quickly they are all likely to suffer”.

I was born in a tent in a refugee camp. I was raised in camp. Without the help of UNRWA I would not have had clothes, food or schooling.

Mohammad Oweis, Palestinian refugee

What programmes does it offer?

According to UNRWA, the US provided $364m to the agency last year and the money it contributed, along with the $650m donated by other UN member states, provided essential relief to more than five million Palestinian refugees.

The funds helped provide for basic commodities such as flour, rice, sugar, powdered milk, canned meats, pharmaceuticals and drugs, and general supplies such as school textbooks and equipment.

Mohammad Oweis, a Washington DC-based political analyst and researcher,  who specialises in the Middle East, said the agency helped people such as himself go on to live a better life.

“I was born in a tent in a refugee camp. I was raised in camp. Without the help of UNRWA, I would not have had clothes, food or schooling,” he said.

Why is funding being cut?

Key to the Trump administration and Israel’s criticism of UNRWA is the way the agency counts the refugees, including in the total tally the decendants of refugees who were orignially diplaced by the creation of Israel. 

Israel fears that the passing of refugee status from parents to children could threaten the country’s so-called “Jewish character”, as Palestinians claim the right of return to their homeland.

Earlier this year, Israeli Prime Minister Benjamin Netanyahu called for UNRWA to be scrapped, and accused the agency of helping “fictitious refugees”.

“UNRWA is an organisation that perpetuates the Palestinian refugee problem and the narrative of the right-of-return, as it were, in order to eliminate the State of Israel,” Netanyahu said.

WATCH: UNRWA concerned about Palestinian refugees in Syria’s Yarmouk (2:38)

His comments were echoed by Nikki Haley, the US Ambassador to the UN, earlier this week who accused the agency of exaggerating the number of Palestinian refugees it currently provides aid to.

“We will be a donor if it [UNRWA] reforms what it does … if they actually change the number of refugees to an accurate account, we will look back at partnering them,” Haley said.

By undermining UNRWA’s definition on refugees, the administration appears to be attacking the Palestinian belief in the “right of return” – that one day the refugees will be able to go back to their ancestral homes.

In emails leaked to Foreign Policy magazine last month, Trump’s son-in-law and senior adviser, Jared Kushner, described the agency as not conducive to “peace”.

And during his visit to Jordan last June, he reportedly pushed for the refugee status of the two million Palestinians registered in the country to be dissolved.

Gunness rejected the administrations’ claims, saying it marked a 180-degree turn from the praise it received by the US last year.

“Late last year the US President said our programs had a great impact, they we were transparent and we had conducted root and branch efficient reforms – saving the agency tens of millions of dollars.

“But within months of receiving that high praise we then get the decision to cut off aid. We need to ask the US administration if and why they are politicising aid”.

By cutting aid, the US is violating international law.

Saeb Erekat, Secretary-General of the Palestine Liberation Organisation (PLO)

What will the cut mean for ordinary Palestinians?

With the UN struggling to grapple with a host of crises, including the wars in Syria, Yemen, Afghanistan and the Democratic Republic of Congo, the shortfall could have disastrous consequences for the five million Palestinian refugees.

According to Gunness, the $217m shortfall means that by the end of September “UNRWA will be running on empty and won’t have enough money to pay for for its 22,000 teaching staff”.

“After September we wont have enough money to run our schools, health clinics and our relief and social services programmes. That is the doomsday scenario.

“We are working tirelessly to avoid that.”

Is anyone stepping in?

UNRWA’s planned budget for 2018 was over one billion dollars. So far, Gulf States, Norway, Turkey and Canada have stepped in with pledges of $238m to help meet the budget deficit.

Gunness said it was “remarkable” the agency had managed to raise so much in the past eight months, adding it had a “long way to go,” as these pledges still need to be paid out.

“We have been very generously supported by over 20 major donors and were looking for money from all of them and also from new donors,” he said.

On Friday, the Jordanian foreign minister, Ayman Safadi, said his country would host a fund-raising at UN headquarters in September with the aim to “close the gap and put in place a plan that will ensure UNRWA’s continued, ongoing funding for the coming years”.

Meanwhile, the German foreign minister, Heiko Maas, said his government had pledged to significantly increase its future contributions, from roughly $94 million this year to an unspecified larger amount.

The Reuters news agency quoted him as saying that “the loss of this organization could unleash an uncontrollable chain reaction”.

How have the Palestinian Authority and Hamas responded?

Senior members of Palestinian Authority denounced the decision and said it violated international law

Prime Minister Rami Hamdallah tweeted: “We reject the US administration’s decision to stop its funding of UNRWA in its latest blatant aggression against the rights of the Palestinian people, international law and UN General Assembly resolution 302 of 1949, which specified that the UN agency was established to provide its services in all areas until the refugee issue is resolved”.

Palestinian Authority Foreign Minister Ryad al-Maliki said: “We will challenge the Trump decision & UNRWA is here to stay as long as there is one Palestinian refugee left.”

Saeb Erekat, the Secretary-General of the Palestinian Liberation Organisation, said the pro-Israel bias of President Trump’s administration has disqualified it from any role in the peace process.

“By cutting aid, the US is violating international law. UNRWA is not a Palestinian agency but was established by the United Nations, and there is an international obligation to assist and support it until all the problems of the Palestinian refugees are solved.”

Meanwhile, senior Hamas senior official Sami Abu Zuhri tweeted: “The US decision to cancel aid to UNRWA aims to remove the right of return and represents a serious American escalation against the Palestinian people. The decision reflects the Zionist background of the American leadership that has become an enemy of our people and our Muslim nation as a whole.

“We insist that we will not succumb to such unjust decisions”.

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