The cash-strapped Palestinian Authority announced on Wednesday it was slashing by nearly one third the salaries of tens of thousands of government employees in the Gaza Strip who have been sitting idly since the rival Hamas militant group took over the coastal territory a decade ago.
The decision deepened the divide between the West Bank and Gaza—two territories that the Palestinians hope to turn into an independent state—and increased hardship in the already impoverished Gaza.
"This cut has worsened our situation. I don't know how I will get by until the end of the month. Shall I beg?" said Rizq al-Haddad, a former maintenance worker at the Health Ministry.
Al-Haddad, a father of 10, supports his family on a salary of about 2,200 shekels, or $600, a month. That income will now drop by nearly $200 a month.
"Our situation was desperate even before they made the cuts," he said in his dilapidated two-bedroom home. "We barely bought thyme and bread for the kids and we can't buy tomatoes because of the desperate situation."
The internationally backed Palestinian Authority, which is based in the West Bank, ordered all of its roughly 50,000 workers to step down after the Islamic militant group Hamas seized power in 2007. But it has continued to pay the salaries of the former policemen, teachers and civil servants like al-Haddad.
In the West Bank, government spokesman Yousif al-Mahmoud said a reduction in foreign aid had forced the Palestinian Authority to cut Gaza salaries by 30 percent. "Without this step, the government cannot pay the salaries of its employees," he said.
Affected workers expressed shock, anger and frustration as they gathered outside Gaza banks. In Gaza City, nearly 200 people joined a protest outside a Bank of Palestine branch. "The salary is our children's right," said one of the banners.
Israel and Egypt have maintained a blockade over Gaza since Hamas, a militant group sworn to Israel's destruction, took power. Israel says the measure, which has restricted the movement of people and goods in and out of Gaza, is needed to prevent Hamas from importing arms. But the blockade has hit Gaza's economy hard, and unemployment is now over 40 percent, according to the World Bank.
The faltering economy has remained afloat through sales of consumer goods. The Palestinian Authority employees have provided a large slice of the purchasing power that business owners rely on to keep their commerce alive.
Hamas, which hired more than 40,000 people to fill the gaps left by the absence of the Palestinian Authority workers, also struggles to pay its employees.
After repeated efforts to reconcile with Fatah failed, Hamas is increasingly relying on hefty taxes on imports, utility fees and customs to pay its employees just half of their regular salaries.