For years, Western governments searched for a formula that would allow them to continue funding the Palestinian Authority while claiming the PA had reformed its long-criticised system of payments to terrorists and their families.
Now that reform narrative is beginning to unravel.
A recent ruling by a Ramallah court has exposed what critics long argued: the Palestinian Authority never fundamentally dismantled “Pay-for-Slay.” It altered the structure, redistributed the payments through new bureaucratic channels, and attempted to present the system as welfare reform rather than a system for rewarding terrorism.
According to reporting in The Times of Israel, a Palestinian administrative court ordered the PA to reinstate stipend payments to the family of a Palestinian prisoner held in Israel. The ruling relied on the PA’s own 2004 Prisoners and Released Prisoners Law, which obligates monthly payments to prisoners, while appearing to sidestep Mahmoud Abbas’s 2025 decree restructuring the system.
The significance of the ruling lies not merely in the payment itself, but in what it reveals institutionally.
The court did not treat the stipend as extraordinary or improper. It treated it as a legal entitlement.
That matters because the Palestinian Authority has spent the past year presenting its reforms to Western governments as evidence that the old Pay-for-Slay model had effectively ended. Abbas’s government claimed payments would instead operate through the Palestinian National Foundation for Economic Empowerment under welfare-style socioeconomic criteria.
But critics argued from the outset that the reform appeared largely cosmetic.
As documented extensively by Palestinian Media Watch, thousands of recipients allegedly continued receiving payments through alternative frameworks — including civil service salaries, security-force positions, pension systems, and indirect welfare structures that functioned to obscure the continuation of terror-linked payments from foreign scrutiny.
Using its own monitoring methodology, PMW estimates that approximately 23,500 terrorists and their families received some form of hidden payment in 2025, at a reported annual cost exceeding US$315 million. Those figures have not been independently audited by third-party international bodies, but they align with the broader pattern documented across the court ruling, PA legal structures, and Abbas’s own public statements.
The Ramallah court ruling now sharpens the contradiction at the centre of the PA’s reform narrative.
Publicly, the Palestinian Authority insists the system has been transformed into a needs-based welfare model.
Internally, its own legal framework continues treating prisoner payments as protected obligations.
Even more notably, PA lawyers reportedly did not challenge the underlying entitlement to the payments themselves. The dispute instead centred largely on administrative implementation.
That distinction is revealing.
The central issue was not whether payments to prisoners should exist. The issue was how those payments could continue while reducing international political and financial consequences.
Those consequences are significant. Israel continues withholding portions of Palestinian tax revenues under anti-terror financing legislation, while the US Taylor Force Act restricts economic assistance to the PA so long as terror-linked payments continue.
Against that backdrop, Abbas’s recent comments at the Fatah conference are particularly notable.
According to The Jerusalem Post, Abbas complained that Israeli withholding of PA tax revenues affected the government’s ability to pay “public employees” and “prisoners.”
The significance of the remark is not that Abbas acknowledged payments exist — he has long defended them publicly — but that it reinforced the continuing centrality of prisoner payments even after the supposed reforms.
In other words, the reforms did not appear to represent a repudiation of the underlying principle. They appeared to represent an attempt to preserve that principle within a more internationally defensible administrative structure.
That is why the debate matters beyond budgetary policy alone.
The issue is not merely whether the PA provides social assistance to families in hardship. Many societies support prisoners’ dependents in some form. The issue is the degree to which the Palestinian Authority continues to embed terrorism-linked imprisonment within structures of political legitimacy, institutional protection, and public honour.
Ordinary criminal offenders are not incorporated into state mythology in this way.
Yet within the PA system, prisoners convicted of terrorism have long occupied a distinct political category — one reinforced not only through payments, but through official rhetoric, legal protections, public symbolism, and bureaucratic preservation.
That institutional culture creates a profound obstacle for any future peace process.
A governing authority cannot credibly present itself internationally as committed to coexistence while simultaneously preserving systems that continue to treat violence against Israelis as politically sacralised conduct deserving of protected state support.
The broader international response has often reflected this tension.
Western governments have generally preferred to frame the issue as one of technical reform rather than ideological orientation. The focus shifted toward whether payments were formally salary-based or welfare-based, whether they passed through one ministry or another, and whether the administrative criteria had been modified sufficiently to satisfy donor requirements.
But the latest court ruling suggests the underlying issue was never simply bureaucratic.
The Palestinian Authority told the international community that Pay-for-Slay had been reformed into a welfare-based system. Yet its own courts continue enforcing prisoner payments as legal entitlements, its own institutional structures continue preserving them through alternative channels, and its own leadership continues treating them as a central governmental obligation.
