UNRWA has implemented austerity measures — including a 20% pay cut for Gaza staff, reduced hours and the dismissal of about 600 employees — after announcing a roughly $220 million shortfall in its 2026 budget. The cuts come amid falling donor contributions following allegations against some staff and growing operational restrictions, including damage to UNRWA facilities. UNRWA and unions warn the measures disproportionately affect Gaza and threaten essential education, health and food services for millions of refugees.
UNRWA Cuts Deepen in Gaza as Funding Shortfall and Restrictions Threaten Aid
INTERACTIVE-GAZA CEASEFIRE-jan 25, 2026_Death toll tracker-1765554400
Gaza City — UNRWA, the UN relief agency for Palestinian refugees, has announced a series of austerity measures that include a 20% pay cut for staff in Gaza, reduced working hours and the dismissal of roughly 600 employees. The agency says the moves are driven by a roughly $220 million shortfall in its 2026 budget — a deficit the agency warns will jeopardize salaries and essential humanitarian programmes for millions of people in Gaza.
What the Agency Says
In a letter to staff, Commissioner-General Philippe Lazzarini described the financial shortfall as severe and unavoidable. UNRWA has repeatedly said it relies on donor contributions for most of its budget; donations fell after several states froze funding following Israeli allegations about some UNRWA employees. The agency says it investigates and disciplines any staff found to have been involved in wrongdoing.
Personal Toll
One affected employee, identified as Maryam Shaaban (name changed for safety), fainted when told she was among about 600 dismissed after nearly two decades teaching for UNRWA. Maryam, 52, who is displaced in Egypt with her critically injured husband, joined the agency in 2007. She says several family members were killed in a December 2023 strike that hit the home where they had taken refuge, and that five of her children were wounded in the same campaign.
Dr Mustafa al-Ghoul, a dentist with UNRWA for 29 years, who heads the agency’s staff union, is currently leading protests against its recent decisions [Abdelhakim Abu Riash/Al Jazeera]
"It feels like leaving for treatment and escaping death has become a crime we are being punished for," Maryam told Al Jazeera, her voice breaking. "They added to our wounds by dismissing us from our jobs. By what law does this happen?"
Operations, Casualties and Allegations
UNRWA records show more than 380 of its staff in Gaza have been killed since October 2023. The agency also reports damage to facilities: earlier this month, Israeli bulldozers partially damaged UNRWA's East Jerusalem headquarters, an action Commissioner-General Lazzarini said came amid broader steps by Israeli authorities that the agency views as attempts to undermine the Palestine refugee identity.
Israel has accused some UNRWA employees of links to armed groups; the agency denies systemic complicity and says it takes disciplinary action when investigations show wrongdoing. In 2025, the Israeli Knesset passed legislation restricting UNRWA operations in areas it considers under Israeli sovereignty, including parts of East Jerusalem. UNRWA has rejected the law as illegal and in conflict with its international status.
Humanitarian Impact
UNRWA provides education, health care and social assistance to millions of Palestinian refugees — who make up a large share of Gaza's population. UNRWA and aid partners say the cuts risk deepening shortages in schooling, medical services and food assistance at a time when humanitarian access into Gaza has been repeatedly constrained.
Jihan al-Harazin with her husband and their three children in their tent west of Gaza City, where they were displaced after their home was destroyed [Abdelhakim Abu Riash/Al Jazeera]
Union leaders in Gaza have protested the measures, arguing Gaza is being disproportionately affected compared with UNRWA's other areas of operation — the West Bank, East Jerusalem, Jordan, Lebanon and Syria. Mustafa al-Ghoul, head of the UNRWA staff union in Gaza, warned that some dismissed staff are chronically ill or caring for injured relatives and that sudden loss of pay and savings will have devastating consequences.
Reactions and Wider Context
Humanitarian and Palestinian civil society figures have criticized the combined effects of funding freezes, operational restrictions and damage to UNRWA infrastructure. Amjad Shawa of the Palestinian NGOs Network described UNRWA as a central pillar of social stability and warned that weakening the agency could undermine refugees' rights and long-term services in Gaza.
UN Secretary-General António Guterres has urged Israel to reverse measures targeting UNRWA, warning that unresolved disputes over the agency's status and seized property could be brought to international legal forums if not addressed.
Note: The figures and incidents cited in this article are drawn from UNRWA statements, Al Jazeera reporting and public records through January 2026.
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