The Israeli government has set aside hundreds of millions of shekels to fund the new humanitarian aid mechanism in the Gaza Strip, Kan news reported Wednesday, contradicting government officials who have insisted that Israel has no part in its funding.

According to the report, the government approved the transfer of NIS 700 million (some $280 million) last month to an unclear source, identified by the government only as “the defense establishment.”

Citing unnamed officials, Kan reported that the money was being used to fund the new aid mechanism, run by the Gaza Humanitarian Foundation, and that the decision to transfer the funds was made under the radar in an attempt to keep the public from finding out — ostensibly since doing so would be highly unpopular with the government’s hard-right base.

The Israel- and US-backed GHF began operating in Gaza late last month, with Jerusalem saying it would serve as an alternative to previous aid distribution mechanisms, as a way to prevent Hamas from hoarding aid and using it to control the population.

At the same time the organization and US officials have maintained that it is an independent and neutral body.

The government has insisted that it has no part in funding GHF, which has faced scrutiny due to the lack of information regarding its funds.

The organization claimed to have received more than $100 million in commitments from a foreign government donor but did not name the donor.

Opposition Leader Yair Lapid suggested last week that the government was secretly funding the aid group through foreign “shell companies,” but this was quickly shot down by the Prime Minister’s Office.

“Israel does not fund the humanitarian assistance to the Gaza Strip,” Prime Minister Benjamin Netanyahu’s spokesman Omer Dostri said. “Israel and the United States are working in full coordination and through various channels to cut off aid from reaching Hamas.”

In response to the Kan report, the Prime Minister’s Office and the office of Finance Minister Bezalel Smotrich insisted that the country “is not funding humanitarian aid to Gaza.”

The New York Times reported late last month that the organization was conceived by several Israelis, including businessmen with close links to the government. The report said the project wasn’t merely built in coordination with Israel, but is “an Israeli brainchild.”

The idea was first proposed in late 2023 at “private meetings of like-minded officials, military officers and business people with close ties to the Israeli government” who believed the government lacked a long-term Gaza strategy, the report said.

The report posited that the “project’s genesis” occurred when “hundreds of thousands of Israeli civilians rejoined the military as reservists, many of them reaching positions of influence,” following the Hamas-led October 7, 2023, attacks.

This created “a huge cohort of Israelis with one foot in the military and another in civilian life, blurring the boundary between the two worlds.”

The group’s central idea was to bypass traditional aid channels like the UN by hiring private contractors to distribute aid in pockets of Gaza under Israeli control, thus weakening Hamas’s grip without formally assuming responsibility for Gaza’s civilian population.

The first days of the GHF’s operations have been mired by violence.

On Sunday, Monday and Tuesday, the IDF said it fired warning shots toward Palestinians outside an aid distribution site after they approached troops while straying off a pre-approved path. Hamas officials and the Red Cross claimed dozens were killed and hundreds wounded from gunfire. The IDF asserts that those figures are exaggerated, while saying it is investigating the allegations.

GHF did not open its sites on Wednesday, after eight consecutive days of operation. The shutdown was implemented in order to carry out logistical work in order to more safely accommodate more Palestinians at distribution sites.

To support civilian safety outside distribution sites, a spokesperson said GHF had asked the IDF to introduce measures that guide foot traffic in a way that minimizes confusion or escalation risks near the IDF-operated perimeter around the sites; develop clearer IDF-issued guidelines to help Palestinians safely reach the distribution sites; and boost IDF training and refine internal procedures to ensure the safety of Palestinians.