Accusations of mismanagement have precipitated the resignation of the head of the UN agency caring for 5.5 million Palestinian refugees, undermining its ability to function and threatening its very existence.

The departure of UN Relief and Works Agency (Unrwa) commissioner general Pierre Krahenbuhl has left it in a precarious situation and at the mercy of detractors in Israel, the US and elsewhere. They have argued for decades that Unrwa is dysfunctional and should close.

Unrwa provides shelter, basic food and health, educational and welfare services to survivors and descendants of 750,000 Palestinians driven from their homes during Israel’s 1948 war of establishment.

Without Unrwa, which began operations in 1950, stateless and impoverished Palestinians would have been a heavy burden on East Jerusalem, the West Bank and Gaza as well as Lebanon, Syria, and Jordan.

While the international community has supported Unrwa for nearly 70 years, funding has always been a struggle. Unrwa’s greatest challenge came last year when the Trump administration – which is closely allied with the right-wing Israeli government – cut $300 million from the annual US donation of $365 million and cancelled all subsequent funding, which was formerly one-quarter of the agency’s $1.2 billion budget.

This move coincided with economic, political, and social crises in the Israeli-occupied Palestinian territories and host countries for refugees.

The US administration’s objective was to exert pressure on Unrwa to “de-register” offspring of the original refugees, thereby ending the “refugee problem” and the need for Unrwa.

The US argued that donors could provide billions of dollars to settle Palestinian exiles permanently in host countries where they would be naturalised. External investment in the West Bank and Gaza would provide an “economic solution” to dependence on Unrwa.

Self-determination

Palestinians have accused the US administration of trying to eliminate them as a nation. They and host governments have rejected the US plan and insist Palestinians must be granted self-determination. Until this is achieved, Palestinians and host governments contend that Unrwa is essential.

Unrwa’s internal investigation accuses Krahenbuhl and his “inner circle” of “sexual misconduct, nepotism, retaliation, discrimination and other abuses of authority, for personal gain, to suppress legitimate dissent, and to otherwise achieve their personal objectives”.

This group included Krahenbuhl’s deputy, Sandra Mitchell, chief of staff Hakam Shahwan, both of whom left in July, and adviser Maria Mohammedi, with whom Krahenbuhl is alleged to have had an affair.

The report concludes that the alleged misconduct of these individuals presents “an enormous risk to the reputation of the UN” and argued “their immediate removal should be carefully considered”.

In an interview with Swiss broadcaster RTS on Wednesday evening, Krahenbuhl said he “rejected these allegations from the start and will continue to do so”. He added: “There is no corruption, fraud or misappropriation of aid.”

The concentration of authority in the “inner circle” is reported to have been triggered by the US withdrawal of funding. In response, the agency cut back services and Krahenbuhl travelled the globe to successfully secure donations to make up most of the loss for this year as well as last.

Since Unrwa still faces a funding gap of $120 million for 2019, several countries that have suspended funding may deliver on pledges once a new team is in place. Former Unrwa official Christian Saunders has been appointed its interim head.