Israel begins payout of Palestinian funds

The salaries will bypass employees hired by Hamas, including the 6,000 members of the militant group's security forces. Security forces in Gaza were told they would be paid only if they stayed home and refused to work under Hamas command.

Under Hamas, the 165,000 government employees had received only irregular, partial payments because of an international aid boycott imposed over the group's refusal to renounce violence and recognize Israel.

The Israeli government said $119 million was transferred yesterday, and Palestinian officials confirmed they received it. The Israelis said there will be another transfer in coming days.

Since Hamas came to power in March 2006, Israel had frozen roughly $600 million, mostly customs duties that it collects on behalf of the Palestinians under interim peace accords. After Abbas expelled Hamas, Prime Minister Ehud Olmert of Israel said the financial transfers would resume.

"Israel is committed to . . . strengthening the new [Palestinian] government and to cooperate fully both in the financial and security realms," said Miri Eisin, a spokeswoman for Olmert.

The tax funds account for roughly half of the Palestinian government's operating budget, and the cutoff had crippled the economy.

Saadi Krunz, secretary of the Palestinian Cabinet, said that with the first transfer, the government has enough money to pay full salaries in the coming two days. The government is the largest employer in the Palestinian territories, and it costs about $120 million a month to cover the payroll.

In addition, the Fayyad government is switching the weekend for civil servants from Thursday-Friday to Friday-Saturday, apparently to make it more compatible with the West's work schedules. In Hamas-ruled Gaza, some government employees were told they should stick to the old weekend and warned they would be punished if they take off Saturdays.

Bilal Qureshali, who works in the Communications Ministry in Gaza, said he would stay home Thursday through Saturday to avoid problems.

Last week, Abbas ordered all armed groups in the West Bank to disarm, including gunmen tied to his Fatah movement, as part of his efforts to restore law and order.

Olmert said he was encouraged by the Fayyad government's recent steps, but that Israel will keep the pressure on Palestinian militants.