Hamas paying public-sector workers in land, not cash

Earth movers dig into sand dunes on land where once Jewish settlements stood — prime real estate that the Gaza Strip's ruling Hamas group hopes will ease its worsening financial crisis.

Hamas has begun handing out plots of the land to 40,000 civil servants loyal to the group, to make up for millions of dollars in salaries it owes them for the past two years.

The land giveaway is the latest sign that Hamas is struggling financially after almost a decade of uncontested power in the coastal strip.

Gazans grumble about lack of jobs, constant electricity shortages and a blockade imposed by Israel and Egypt that has confined the territory's 1.8 million people to the tiny strip. The World Bank says unemployment is 38 percent.

Since 2014, Hamas' main problem has been a dire lack of cash amid Egypt's clampdown on smuggling tunnels underneath Gaza's border with Egypt's Sinai Peninsula.

Before the tunnels closed, Hamas earned millions of dollars from taxes on smuggled consumer goods, including subsidized Egyptian fuel.

Later that same year, Hamas and its rival, West Bank-based Palestinian President Mahmoud Abbas, agreed to form a unity government for both Gaza and the West Bank. Abbas had lost Gaza to a Hamas takeover in 2007, and this was an attempt to heal the split.

But the deal stalled, partly because Abbas refused to add the 40,000 employees hired by Hamas since 2007 to the payroll of his Palestinian Authority.

The land giveaway allows each group of four Hamas employees to share a 500-square-meter plot that they can either build on or sell

In time, Hamas resorted to paying its loyalists 40 percent of their salaries at 50 day intervals.

Since March, after Hamas collected additional taxes, these civil servants have been receiving 45 percent of their salaries on a monthly basis. The price of cigarettes went up 35 percent and an additional $30 in taxes was imposed on each tonne of fruit entering Gaza from Israel.

The land giveaway allows each group of four Hamas employees to share a 500-square-meter plot that they can either build on or sell. Even the sand collected on the land can be sold for about $100 a truckload.

About 13,000 civil servants have already signed up for certificates attesting to their ownership of the plots. Bulldozers are working to get three initial projects launched in August.

Most of the land once was part of Jewish settlements in southern Gaza, near the towns of Rafah and Khan Younis. The settlements were demolished when Israel pulled settlers and soldiers from the coastal strip in 2005.

Earlier this week, earth-moving equipment dug into a high hill near Khan Younis, scooping out sand and loading it into trucks at the site designated for the Al-Isra 2 housing project.

Riham Khalil, one of the civil servants, said Hamas owes her 64,000 shekels (about $17,000) in back salaries. Last month, she and three of her colleagues were allocated a 500-square-meter plot in Al-Isra 2.

"We had to accept it on a 'bird in the hand' basis because there was no cash," she said. "I wish I could find someone to buy the land and get the money."

Senior Hamas official Salah al-Bardawil said the land giveaway is a temporary fix, "not yet a strategic one" that would solve the group's financial problems for good

Senior Hamas official Salah al-Bardawil said the land giveaway is a temporary fix, "not yet a strategic one" that would solve the group's financial problems for good.

If Abbas had put Hamas employees on his payroll, he would have likely encountered major problems with donor governments, including the United States, suspicious of money ending up in the pockets of Hamas, which much of the West considers a terrorist group.

The West Bank-based Palestinian Authority opposes the land-for-money program.

"No one has the authority to issue decisions to privatize government-owned land in the public interest, except for President Abbas," said PA spokesman Jamal Dajani.

He dismissed Hamas' claims that Abbas has neglected Gaza. The Palestinian Authority still pays the monthly salaries of some 70,000 civil servants in Gaza who are loyal to Abbas and left their posts after the Hamas takeover.

The Gulf Arab state of Qatar has bailed out Hamas in the past and recently announced it was giving about $30 million to help pay a full month's salary to all Hamas employees in Gaza. In October 2014, Qatar sent cash to half of Hamas' public employees, excluding the security forces.

Hamas has been spending some of its new revenue to fund summer camps, where children are exposed to its militant anti-Israeli ideology, or for large communal evening meals known as iftars during the Muslim holy month of Ramadan.

It is also looking to its patron Turkey to help resolve Gaza's growing electricity and water shortages. Gazans live with rolling power cuts of 12 to 18 hours a day and the strip's water is polluted and undrinkable.

After an Israeli-Turkish reconciliation deal in early July, Turkey sent an aid ship to Gaza through an Israeli port and a delegation that met separately with Israeli, Palestinian and Hamas officials to explore Gaza's energy crisis and outline possible solutions.

However, Turkey's efforts are mere band aids for Gaza's larger woes and could serve to empower Hamas even further, said Mkhaimar Abusada, a political scientist at Gaza's Al-Azhar University.

"They increase Hamas' determination to cling to its unilateral governing of Gaza," Abusada said. "Time will tell if these promises are enough to convince the Palestinian citizen to keep silent over his living conditions."