Ousted Arabs may take cash

FROM SAM KILEY IN DEHEISHA REFUGEE CAMP, WEST BANK

FOR 52 years it was a dirty word, but Palestinian officials have started to whisper the unmentionable - "compensation" for refugees from Arab-Israeli wars.

The move, which verges on heresy for many of the 3.6 million Palestinian refugees and their descendants, has caused uproar in the cramped streets of the concrete camps on the West Bank and Gaza. On Wednesday night thousands of young people, led by Munar Faraj, 14, poured into Manger Square in Bethlehem to swear allegiance to the slogan on which they had grown. "No compromise on our right of return - no money for land," they chanted while lighting candles in the square, where the last big turnout was for the Pope.

Successive Israeli governments have refused even to acknowledge Israeli responsibility for the creation of about a million original refugees and the destruction of hundreds of villages, much less to allow them home. Israelis fear, however, that they face a demographic time bomb and will be outbred by Arabs, who would want to change the Jewish nature of the state. So some Palestinian authority officials have begun to float the idea that perhaps the time has come to seek compensation. Figures between £25 billion and £170 billion have been suggested.

In the wider Middle East peace talks at Camp David, President Clinton stepped back yesterday, hoping that Ehud Barak, the Israeli Prime Minister, and Yassir Arafat, President of the Palestinian Authority, might make more progress without his presence and be more likely to resolve issues on their own.