May 29, 2024

UNRWA at a Crossroads:

Charting a Course to Meaningful Reform

By Dr. Shira Efron, Alex Lederman, and Jess Manville
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October 7 and the war in Gaza have cast a spotlight on UNRWA’s deep-seated and longstanding flaws. In our latest policy report, Dr. Shira Efron, Alex Lederman, and Jess Manville chart a path toward incremental and meaningful UNRWA reform to align the agency with realistic future outcomes to the conflict, guarantee dignified service provision for Palestinian refugees, and account for Israel’s legitimate security needs.

Overview

October 7 and the ensuing Gaza war have brought new urgency to addressing the contested role of the United Nations Relief and Work Agency for Palestine Refugees (UNRWA). Since its inauguration in 1949, the agency has been a critical lifeline in delivering essential services and relief to registered refugees in Gaza, the West Bank, East Jerusalem, Jordan, Syria, and Lebanon—a beneficiary population now numbering 5.9 million. In the absence of a negotiated political solution to the conflict, it also serves as a powerful symbol of the Palestinian right of return. 

For decades, UNRWA’s structural flaws, politicized nature, and operational inefficiencies have raised big questions about its viability and integrity. Nonetheless, the prevailing consensus among local and international stakeholders, Israel included, favored preservation in the name of stability over overhaul. Today, however, the discourse has entirely shifted as UNRWA faces its most existential crisis of legitimacy to date: allegations of employee ties to Hamas and staff involvement in the recent atrocities. These issues have unveiled the depths of the agency’s systemic neutrality, oversight, transparency, and accountability deficiencies. The debate around UNRWA’s future has intensified not only in Israel but also among donor countries, with the United States at the center. 

This report aims to chart a path toward meaningful reform—adopting an incremental and performance-based approach—that reshapes UNRWA in line with realistic future outcomes to the conflict, guarantees dignified service provision for Palestinian refugees, and accounts for Israel’s legitimate security needs. The 50 recommendations proposed in the Colonna Report provide a robust starting point for addressing neutrality-related matters. Successful implementation requires that such reforms be coupled with conditional funding, stringent oversight, and a coordinated multilateral effort. Expecting UNRWA to reform voluntarily will continue to prove ineffective.

Amid Gaza’s humanitarian crisis, immediate actions require prudent, yet progressive and foundational steps that address glaring security and neutrality challenges are also required. The medium term demands ambitious measures focused on streamlining and optimization, including transferring services currently performed by UNRWA that are not included in its mandate to other entities. The ultimate aim is to transition UNRWA’s responsibilities in the Palestinian territories to a revitalized Palestinian Authority (RPA), ideally as part of a credible pathway toward a political process that advances a two-state outcome. The U.S., in collaboration with a coalition of international actors, is ideally positioned to lead this effort, recognizing that only a multilateral approach can achieve the desired change.

Dynamics of U.S.-UNRWA Relations

The United States has largely been a steadfast partner of UNRWA, providing the agency with over $7.1 billion since 1950. Although there have been periods of reassessment concerning UNRWA’s role reflecting shifting geopolitical and political trends, almost every president—Republican and Democratic alike—has deemed the agency’s existence to be vital to the national security of the U.S., Israel, and the region at large. A major policy shift occurred when the Trump administration cut all U.S. funding to UNRWA in 2018, accounting for one-third of the agency’s budget, citing UNRWA’s “unsustainable” operational-business model and ties to Hamas. However, this unilateral U.S. step resulted in other donor countries stepping in to fill the gap, rendering the U.S. funding freeze a missed opportunity to drive UNRWA reform. The Biden administration’s resumption of funds without placing enforceable conditions was another missed opportunity to effect much-needed change. 

In a post-October 7 reality, the U.S. is again undergoing a significant reassessment of its relationship with UNRWA as Democratic politicians have grown increasingly critical of the agency following the recent allegations. The $1.2 trillion appropriations package passed in Congress in March stripped U.S. funding to UNRWA until March 2025. Yet, in the absence of a reform plan in place and without any viable substitutes, the U.S. could once again miss an opportunity to shape the agency’s future in line with its values and foreign policy interests.

UNRWA’s History and Critical Functions

Core Services

On December 8, 1949, the U.N. General Assembly adopted Resolution 302 (IV), creating UNRWA in order to provide direct relief and works programs to refugees displaced by the 1948 war. In the decades since, UNRWA has evolved into a long-term service provider for a growing population of registered refugees delivering education, health care, relief and social services, microfinance, and infrastructure and camp improvement. Despite Palestinian refugees’ political and economic marginalization, UNRWA has accrued significant achievements over its lifespan. Education, its largest program (59% of its total budget in 2023), has notably boosted literacy rates and economic prospects, offering refugees pathways out of poverty, especially in the first decades of the agency’s operation. UNRWA’s health program has effectively combated communicable diseases in camps, advanced reproductive and mental healthcare, and pioneered new programs like its oral-rehydration therapy for infants. It was also pivotal in executing the COVAX plan for Palestinians in the West Bank and Gaza. Moreover, it has provided stable employment opportunities (albeit a major neutrality challenge), substantially contributing to improving the population’s overall well-being.

Distinct from other U.N. bodies, UNRWA provides services directly to the population, bridging a critical governance void and functioning as a quasi-governmental body. Its historical indispensability is best characterized by its vast scope and magnitude, serving millions of individuals across five operational contexts with a workforce numbering around 30,000. For all its flaws, it has prevented a service-provision vacuum in the absence of viable alternatives, offsetting the political and economic cost for host states and Israel alike. The international community, Israel, and Western donor states have mostly regarded UNRWA as a source of stability in a volatile region.

Emergency Response in Gaza

UNRWA is currently undertaking its most extensive emergency response to date: seeking $1.21 billion to cover the next phase of its Flash Appeal for April to December 2024 in order to address the profound humanitarian crisis in Gaza, coupled with expanded activities in the West Bank.  The agency is at the forefront of the humanitarian effort—delivering essential food supplies, primary healthcare services, non-food items, and operating shelters—and has unmatchable levels of capacity and logistical knowledge. Meanwhile, other U.N. agencies rely on UNRWA’s network and architecture for their own distribution. Despite UNRWA serving as the primary conduit for international aid entering Gaza, recent funding suspensions and Israel’s unwillingness to cooperate with the agency have constrained its ability to operate, particularly in the north of Gaza. While the roles of other U.N. agencies and NGOs have been augmented, the immense scale and scope of the humanitarian crisis necessitates a collective, all-hands-on-deck effort. Continued significant disruption will risk livelihoods and produce greater instability. Furthermore, even if other U.N. agencies, such as the World Food Programme (WFP) can substitute some of UNRWA’s humanitarian aid functions during the current emergency stage, the agency capacity will be most needed in the recovery and reconstruction phases. 

Criticisms of UNRWA

Despite the critical role UNRWA plays, the agency is the subject of various criticisms.

Ambiguities in Mandate and Governance

The ambiguities in UNRWA’s mandate have allowed it to evolve in a makeshift manner, leaving it susceptible to politicization. Unlike other U.N. agencies, UNRWA has no comprehensive document or charter codifying its mandate and derives its authority from various sources. Structural vagueness, including the absence of a governing board, creates an accountability gap. Oversight of UNRWA is unclear, and the fluidity of its mandate has allowed it to expand its functions over the years to include services typically provided by a municipality, like waste management. Such expansions raise sustainability concerns, given UNRWA’s constrained financial and human resources. 

Politicization

Despite UNRWA’s avowedly nonpolitical mandate, it has become deeply politicized by its key stakeholders. The tension between advocates for the right of return and those pushing for integration or resettlement is central to this dynamic. Lacking the authority to seek durable solutions like UNHCR, Arab states linked its founding document—UNGA Resolution 302—to UNGA Resolution 194, which refers to the right of Palestinian refugees to return. For Arab host states and Palestinians, this linkage codified the right of return, affirmed the resolution to the refugee problem as a responsibility of the international community, and positioned UNRWA as a political advocate for the Palestinian national cause.

Defining Palestinian Refugees

UNRWA’s own definition of Palestinian refugees is distinct from universal definitions of refugeehood. The agency developed this definition in an ad hoc manner, undergoing several iterations and subject to critique for its broad applicability, propensity for adaptation, and inconsistencies. U.N. Resolutions 302 and 194 did not clearly define Palestinian refugees, leading to the formulation of an operational rather than a legal definition to determine eligibility for UNRWA’s services. Additionally, UNRWA extends services to some individuals who, according to the agency’s own definition, do not meet its refugee criteria.

Inheritability 

Most of the 5.9 million people eligible for UNRWA services today, deemed by the agency as “Palestine refugees,” were not among the approximately 750,000 who fled Mandatory Palestine between 1947 and 1949. Today, all patrilineal descendants of refugees are eligible to register. While inherited refugee status is not exclusive to UNRWA as UNHCR also offers derivative status, UNRWA’s mechanism allows for automatic, less strictly regulated, and unlimited registration. This is compounded by the absence of available avenues for relinquishing refugeehood, such as maintaining the status despite gaining citizenship in a host country.

Status Rather Than Need

Palestinian refugees retain their refugee status for life, even if they receive citizenship from another country and even if they may no longer require assistance. A sizable yet undetermined share of UNRWA’s beneficiaries do not necessarily need its services, thereby diluting the resources available for the truly needy.

Education

UNRWA’s educational practices and procedures have come under intense scrutiny. While UNRWA uses host country textbooks and has no mandate to alter them, it reviews all newly issued content and creates its own supplemental curricula. Criticism centers on the lack of adequate measures in place to remove content that incites violence, glorifies terrorism, dehumanizes  “the other,” and contains antisemitic language. Concerns also exist that UNRWA teachers  fail to effectively filter out objectionable content, given that many potentially have such views. Maximalist Palestinian national narratives in school curricula, reflecting popular sentiments among refugees, compromise UNRWA’s neutrality.

Employees

Around 99% of UNRWA’s workforce is Palestinian and, as the largest employer among Palestinians after the PA, the agency serves as an essential source of livelihood. But this policy undermines the agency’s commitment to neutrality, given that most of its employees ascribe to a specific national narrative on the conflict, a dynamic that is most problematic in Hamas-run Gaza. UNRWA lacks adequate screening, vetting, and monitoring mechanisms to prevent hiring staff involved in terrorism and the abuse of UNRWA facilities for such activity. While UNRWA considers involvement in “a militant group or terror activities” to be grounds for termination, UNRWA uses the Consolidated U.N. Sanctions List—which excludes Hamas and Palestinian Islamic Jihad—to determine what qualifies as a terror organization. 

Funding

  • UNRWA is primarily funded through voluntary contributions from U.N. member states, the European Union, and other organizations. Dependency on this type of funding, granted at the discretion of each donor country, makes the agency susceptible to geopolitical shifts and political unpredictability. Consequently, on an annual basis, UNRWA invests a disproportionate amount of its human resources to actively solicit donations. The agency faces chronic funding challenges and often finds itself without reserves. The instability of UNRWA’s funding situation prevents long-term planning and contributes to a sense of systemic institutional precarity. More consistent funding could enable investment in improving services and strengthening oversight and monitoring procedures. 

Transparency

UNRWA faces scrutiny over its transparency, particularly regarding its internal processes, procedural frameworks, and publicly available information on the demographics of the 5.9 million refugees it registers. Critics argue that UNRWA’s political agenda of preserving the right of return is linked to inflating the number of refugees. raising questions about the accuracy of its data, which relies on voluntary self-reporting and lacks detailed breakdowns. Efforts to enhance transparency have been implemented, but balancing operational integrity in conflict zones with the high accountability standards expected by donors remains a challenge for UNRWA. 

Pathways for Change

October 7 and the war in Gaza have ignited new discussions and revived longstanding debates regarding UNRWA’s future. As stakeholders formulate civil-governance models for post-war Gaza, a pivotal opportunity exists to recalibrate the agency’s role, tackle fundamental operational challenges, and address the systemic, deep-rooted political and structural problems that have compromised it for decades. The spectrum of strategic responses ranges from the complete dissolution of UNRWA to a process of meaningful reform. Situated between these polarities are various hybrid approaches that account for the timeline of the ongoing Gaza war, UNRWA’s multi-arena areas of operation, and its extensive service portfolio. We present the two key pathways toward change and outline the considerations that accompany each.

Dismantling and Replacing UNRWA

A growing number of Israeli and U.S. officials view UNRWA as unfit to continue operating and seek its dismantlement, with Gaza seen as the strategic starting point for doing so. For Palestinians, dismantling the agency would be seen as a direct affront to their claimed right of return.

In the short term, several U.N. bodies and other international non-governmental organizations have been listed as potential replacement options for some of UNRWA’s functions, including the World Food Program (WFP) for food assistance, the World Health Organization (WHO) for health, United Nations Development Programme for sanitation, United Nations International Children’s Emergency Fund (UNICEF) for education, and the International Organization for Migration (IOM) for shelter.

As part of the post-war process of reimagining Gaza’s government apparatus, options for filling the vacuum left by UNRWA depend largely on the level and scope of Israel, the PA, and Hamas’ presence within, and control over, the territory. Some argue that the emergence of a local governing body supported by a regional Arab force, U.N. agencies, and international organizations may alleviate the need for UNRWA’s service-provision role.

Outside Gaza, proposals to transition UNRWA services to host countries have faced resistance from Arab governments and the refugee population due to ideological, economic, and demographic concerns. Dismantling UNRWA would be operationally complex and politically charged, requiring apt substitutes, high levels of stakeholder coordination, and new funding commitments.

Reforming UNRWA

This approach is predicated on the belief that no obvious substitute for UNRWA exists and that the need for the agency outweighs its significant flaws. Reforming UNRWA could include more technical managerial and operational adjustments or politically sensitive structural reforms targeting eligibility criteria and enhancing accountability. UNRWA’s past attempts at self-reform have failed to affect meaningful change, primarily due to the lack of repercussions for non-compliance and inaction. The post-October 7 environment demands a more incisive approach, underpinned by robust oversight and a strategic use of international funding to ensure adherence.

Challenges to Reforming or Phasing Out UNRWA

Gaza’s governmental vacuum: Given the uncertainty surrounding who will administer Gaza upon the war’s conclusion, removing or substantially diluting UNRWA’s role without a viable alternative in place risks creating a substantial service-provision gap and destabilizing the territory. UNRWA is unique as a quasi-governmental agency responsible for direct, long-term service provision. Other U.N. agencies act more as transitional support and build institutional capacity to ensure relief and recovery do not continue indefinitely, and thus are far more reliant on local governments. 

Limitations of other U.N. agencies: There is no obvious U.N. or INGO substitute for UNRWA. Bringing in other bodies to assume UNRWA’s functions would be bureaucratically and logistically complex and would require international backing, buy-in from across the U.N. system, and an influx of funds. Replacing UNRWA’s substantial workforce to run schools and health clinics, among its other functions, would likely result in hiring from the same trained pool of individuals, leading to change in name only. Furthermore, U.N. agencies currently not operating in the West Bank and Gaza would have to formally be invited by the PA, which is unlikely to do so in the current environment to avoid increasing tensions both with UNRWA and the refugee representatives.

Shortcomings of merging UNRWA with UNHCR: Contrary to popular claims, merging UNRWA into UNHCR would not impact Palestinians’ legal claims to the right of return. Any solution to the refugee issue would still require buy-in from all parties.

Israel’s political, security, and public positioning: Historically, the Israeli security establishment viewed UNRWA as a buffer against destabilization and humanitarian crises. Today, however, it is more aligned with Israel’s political leadership in seeking the agency’s dismantlement and prioritizing counter-terrorism concerns. Disagreements persist regarding the strategy, ranging from full dismantlement to gradually lowering dependency on the agency by substituting its functions. Israeli efforts to obstruct UNRWA’s operations pose a significant challenge to humanitarian aid delivery.  

Palestinian resistance and reluctance: Any steps perceived by Palestinian refugees as curtailing UNRWA’s scope or scale will be resisted and interpreted as a direct assault on the right of return. The PA, grappling with a severe legitimacy crisis and record-low public support, is unlikely to endorse any transition of services to its control without a credible political process.

Beyond the Palestinian Territories: Host-Country Considerations

Lebanon: Lebanon’s Palestinian refugees lack citizenship and many basic rights, including the rights to own property, travel freely, and access the labor market. Integrating them would face significant pushback as it would upset the country’s delicate sectarian balance. Meanwhile, Lebanese officials continually stress the country’s reliance on UNRWA amid Lebanon’s economic crisis.

Jordan: Jordan is relatively stable and most Palestinian refugees have full citizenship. But the kingdom does rely on UNRWA to provide welfare and education to many of its 2.4 million Palestinian refugees. Upsetting this dynamic could threaten Jordan’s role as a force for regional stability.

Syria: The Syrian civil war has greatly increased the refugee population’s dependence on UNRWA amid violent unrest, economic crises, and public-health concerns. This volatile situation would pose a challenge to upending UNRWA’s operations.   

Policy Recommendations

We recommend that the United States spearhead a multilateral effort to transform UNRWA through a hybrid strategy of reform and replacement: streamlining UNRWA’s services where feasible, selectively replacing certain elements, and thoroughly reforming the agency as a whole. In the long term, we call for transitioning UNRWA services to the revitalized Palestinian Authority in Gaza and the West Bank. This approach is designed to prevent service vacuums, embrace incrementalism, account for the uncertainty surrounding post-war Gaza, and advance a long-term vision that includes a political process—all while addressing UNRWA’s compromised neutrality, inefficiencies, unsustainable model, and other key flaws. 

Short Term

Restore U.S. funding to UNRWA, but only contingent on the implementation of a realistic and reform framework that includes the following:

  • A stringent vetting mechanism for hiring that includes thorough background checks, recognizes Hamas and Palestinian Islamic Jihad as terror organizations, and is subject to review by Israel and the PA (and possibly a third country, preferably the United States).
  • Upgraded security at UNRWA facilities to prevent exploitation by militant forces.
  • A transparent registry of UNRWA employees.
  • Detailed demographic reporting on the composition of the refugee population.

Develop multilateral mechanisms to address UNRWA’s challenges:

  • A multilateral forum including Israel, the PA, and donor countries to create a strategic roadmap toward reforming and eventually phasing out UNRWA.
  • Conditional, incentive-based funding models to compel UNRWA reform, based on a donor community-wide set of realistic and reasonable performance metrics.
  • A U.S. UNRWA monitor within the Office of the Secretary of State to ensure the agency’s compliance with the reform agenda. 

Reduce UNRWA’s role by scaling up funding to other humanitarian agencies: Upon resuming funding for UNRWA, the U.S. and other donors should simultaneously increase funding to other U.N. agencies, INGOs, and local NGOs to diversify the humanitarian response. To facilitate this goal, the U.S. should encourage more effective Israel-NGO partnerships and dialogue. 

Medium Term

Establish a Gulf-led task force to facilitate educational reforms across the Palestinian territories:

  • Reformed PA and UNRWA school curricula that embody the values of peace, tolerance, and multicultural understanding and reject violence and extremism.
  • An enhanced teacher-training initiative to ensure educators’ proficiency in new materials.
  • Robust monitoring mechanisms to ensure compliance.
  • Stronger English, math, and science curricula.

Implement measures to streamline and optimize UNRWA services:

  • A needs-based distribution model to improve service efficiency that reduces services for refugees who have foreign citizenship.
  • Services tailored to the actual needs of each operational zone.
  • A structured plan to delegate non-core UNRWA functions, such as waste management, to local governments, NGOs, and INGOs.

Long Term

Transition UNRWA services to the revitalized Palestinian Authority (RPA) in Gaza and the West Bank: In the context of a political process that advances an eventual two-state outcome, an RPA with enhanced legitimacy, capacity, and funding will gradually assume responsibility for UNRWA’s services. This transition will respect Palestinian refugee status and will affirm that the refugee issue is to be resolved in permanent-status negotiations.

Transition UNRWA services to host countries: This process should begin with less contentious sectors, e.g. health care. It will require an increase of funding from donor countries to host governments and incentives to demonstrate potential benefits to host-country populations, and should ideally be carried out as part of a political process.

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