Palestinian finance chief pledges pay on Monday

RAMALLAH, West Bank, June 3 (Reuters) Palestinian Finance Minister Omar Abdel-Razeq today said the government would begin to pay long-overdue salaries to some of its employees today.

Abdel-Razeq made the pledge at a news conference amid mounting protests over non-payment of wages. Prime Minister Ismail Haniyeh said yesterday banks would start paying salaries to some 40,000 workers in the next day or two.

The Palestinian government has about 165,000 employees on its payroll. None has been paid for at least three months, since Hamas took power and Israel and the West cut off funding to the Islamist-led government.

The 40,000 workers slated to begin receiving money on Monday earn up to 1,500 shekels a month (320 dollars), a figure totalling about 13 million dollars or some 11 per cent of one month's 120 million dollars payroll.

Abdel-Razeq said the government could meet the partial payroll through the 25 million dollars to 30 million dollars it collects each month in local revenues.

He told the news conference the 40,000 employees could draw their salaries through banks in the Palestinian territories, with the exception of the Arab Bank, which he said ''has legal problems'' with the United States.

Banks in the West Bank and Gaza have said they feared U.S.

sanctions should they handle funds for the Hamas-led government.

The United States views Hamas, whose charter calls for Israel's destruction, as a terrorist organisation.

Abdel-Razeq said employees with accounts in the Arab Bank will be able to receive their money in post offices in the West Bank and Gaza Strip, he said.

Government employees earning more than 1,500 shekels a month will eventually receive advances on their salaries, he said, giving no date.

REUTERS SHB PC1631