Switzerland has cancelled its financial backing for the Palestinian refugee agency Unwra because of its lack of neutrality on the conflict.

The Swiss gave $21 million in aid to Geneva-based Unwra this year, making it the agency’s ninth largest donor.

The cancellation was announced by the lower house of the Swiss parliament. It was proposed by People’s Party MP David Zuberbühler, who accused Unwra of not being neutral over the Israel-Hamas conflict.

Marcus Sheff, CEO of IMPACT-se, an organisation based in the UK and Israel which monitors educational institutions globally, praised the decision.

“Israelis have been let down disastrously by the gaggle of international organisations that make Switzerland their home, and none more so than Unwra,” he said. “Now, the Swiss parliament is having its say. We hope the diplomats are paying attention to their hosts.”

But Unwra chief Philippe Lazzarini criticised the move and said he hoped it would be overturned by Switzerland’s upper house.

“Disheartened by Switzerland Parliament’s national council move to cut aid to Unwra, as the Agency is recognized as a major humanitarian actor in #Gaza & the region,” he posted on X/Twitter. “Hope the Senate will revise this decision as Unwra is the first responder in Gaza and a lifeline for millions.

“As a country that leads on International Humanitarian Law, I am disappointed in this decision to cut aid to the largest and most active Humanitarian Agency on the ground in #Gaza today. Cutting funds jeopardizes services during an unfolding humanitarian catastrophe.”

IMPACT-se has long campaigned against Unwra’s use of what it calls “incendiary” textbooks used by the Palestinian Authority (PA) in its schools in Gaza, the West Bank and Jerusalem.

The Swiss government has previously voiced concerns over hate-teaching in UNRWA schools. In 2021, it said that PA textbooks used in UNRWA schools include “one-sided and antisemitic representations”.

Founded in 1949, UNWRA (United Nations Relief and Works Agency for Palestine Refugees in the Near East) employs some 30,000 people, many of them Palestinian.

In 2022, it received nearly $1.2 billion in aid from countries and other international organisations.