HIGHLIGHTS: 40 Palestinians Wounded, 8 Seriously; Cause of Blast Unknown||Reduced Cabinet Will Prepare for Municipal, Legislative & Presidential Elections||Hamas & DFLP Slam Reforms as Superficial|| STORY: Around 40 Palestinians were wounded, eight seriously, by an explosion inside a house in the Jabaliya refugee camp early on Monday, Palestinian residents and security sources said. (Read photo caption)

They said the cause of the blast was unknown, but that it seriously damaged the house of a Palestinian military intelligence official in the camp.

Ambulances rushed the wounded to hospital and Palestinian security officials said they were opening up an investigation into the cause of the blast which damaged about eight houses.

At least two Palestinians were killed while making a bomb in a house in the same area of the refugee camp about two weeks ago, residents said.

Dozens of Palestinians have been killed while preparing bombs for use against Israel since a Palestinian uprising against Israeli occupation began in September 2000.

NEW PA CABINET MEETS MONDAY

Palestinian President Yasser Arafat reduced his cabinet on Sunday to 21 ministers from 31 as part of a plan to reform the Palestinian Authority

Information Minister Yasser Abed Rabbo told reporters at a news conference in the West Bank city of Ramallah, "Some ministries were merged together and others were introduced and the number of ministers was trimmed." "This transitional government will have the task of preparing the municipal, legislative and presidential elections, slated for the end of 2002 and the start of 2003," he added.

Abed Rabbo said the new cabinet would hold its first meeting on Monday.

Among the changes announced Sunday in Ramallah was the creation on a new post, that of interior minister.

For their part, Hamas and the Democratic Front for the Liberation of Palestine (DFLP) slammed the reforms as superficial.

The DFLP demanded Arafat set a date for presidential and parliamentary elections. Both groups were invited to join the new cabinet but declined. Hamas condemned the new Palestinian cabinet, saying the appointments were a product of U.S.
intervention and would not reduce domestic corruption.

PHOTO CAPTION

Palestinians inspect the wreckage after an explosion at a building in the Jebaliya refugee camp in the Gaza Strip, Monday, June 10, 2002. A mysterious explosion went off early Monday in a building in the middle of the camp, destroying about 10 houses and injuring at least 25 people. (AP Photo/Adel Hana)