There are fears a decision by New Zealand to cut funding to an under-fire United Nations (UN) aid agency supporting Palestinians could affect hundreds of thousands of students and lead to an "explosion".
The United Nations Relief and Works Agency for Palestinian Refugees (UNRWA) operates hundreds of schools and educational programs across the West Bank, Gaza Strip and east Jerusalem, the Jerusalem Post reports.
However an internal UNRWA report has found "credible and corroborated" allegations of serious ethical abuses within the organisation, including "sexual misconduct, nepotism, retaliation, discrimination and other abuses of authority, for personal gain, to suppress legitimate dissent, and to otherwise achieve their personal objectives".
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In the aftermath of the report, three countries - the Netherlands, Switzerland and Belgium - announced they would be pulling funding due to the scandal.
New Zealand provides around $1 million each year in core funding to the agency - along with "additional one-off" contributions, and the Ministry of Foreign Affairs and Trade (MFAT) says it is considering whether this funding should continue.
"The ministry will review the findings of the UN Office of Internal Oversight Services (OIOS) report once the investigation is complete and after that point provide advice to the Minister of Foreign Affairs on future funding," an MFAT spokesperson confirmed to media.
"We expect UNRWA to cooperate fully with the investigation underway and to report back on the investigation's findings and recommendations."
But Palestinian officials fear a cut in funding would have damaging effects on their children's education.
"Half a million Palestinian children who depend on your regular contributions cannot suspend their classes until the results of the investigation," PLO secretary-general Saeb Erekat told the countries that have already cut funding.
Other officials warned a halt to UNRWA activities would lead to a "big disaster".
"It will be a huge problem because of the high number of students who rely on UNRWA schools," an official with the Ramallah-based Palestinian Ministry of Education told the Jerusalem Post.
"This could lead to an explosion."
Newshub.
