Britain, Australia and Canada launch grassroots peace fund for Israel, Palestinians

Three governments have put a modest sum behind a large diplomatic gamble: whether £3 million, about $4 million, can still matter in a conflict where formal negotiations have stalled and violence has deepened. Britain, Australia and Canada said the new fund will support grassroots work tied to a future two-state solution for Israelis and Palestinians, with money aimed at youth groups, civil society organizations and women rather than a top-down peace package.

Each government is contributing £1 million, and British officials said the fund is meant to back both existing programmes and new ventures, from local community projects to dialogue among future leaders. The aim is to scale up work already on the ground and, once the fund is operating, attract more donors. That makes the project as much a test of international confidence as a financial commitment: whether outside governments still believe peacebuilding can be built from the bottom up while Gaza remains at war and the broader Israeli-Palestinian picture stays volatile.

The announcement also fit into a wider coordinated diplomatic effort. The foreign ministers of Britain, Australia and Canada were preparing to meet in Britain, underscoring the three countries’ attempt to align their public pressure on the conflict with practical support for civil society. Britain had already said it would host a peacebuilding conference at Lancaster House in London on 12 March 2026 to help establish an International Peace Fund for Israel and Palestine, and it said the effort would draw on lessons from Northern Ireland and the Western Balkans.

Britain formally recognised the State of Palestine on 21 September 2025, saying the move was meant to protect the viability of a two-state solution. Australia says it remains committed to that same outcome and continues to provide humanitarian and development assistance to Palestinians, including a 2025-26 UNRWA allocation of A$20 million. Canada’s official position says the security situation in Israel and Palestine remains volatile and unpredictable, and it condemns the Hamas-led attacks on Israel on 7 October 2023.

The new fund arrives as Western governments try to keep the two-state idea alive without the benefit of a credible negotiating track. On 9 June 2026, Australia, Canada, France, Norway and Britain also issued a joint statement on deteriorating conditions in the West Bank and announced sanctions and other measures against extremist settlers. Against that backdrop, the peace fund is less a breakthrough than a signal: if diplomacy cannot yet deliver a settlement, governments are still willing to bankroll the civic infrastructure that might someday make one possible.