Palestinian Authority Introduces New System For Payment Of Allowances To Terrorists And Their Families; Recipients Will Now Withdraw Funds From Postal Bank Via ATMs In Post Offices

On July 6, 2021, the Palestinian Authority (PA) announced the introduction of a new system for disbursing the allowances it pays to terrorists and their families: Allowance recipients will receive ATM cards for withdrawing the funds from the PA postal bank via ATMs at PA post offices.

This move came against the backdrop of the severe deficit in the PA budget, which stood at $470 million in the first half of 2021.[1] It is also in line with the policy of Palestinian Authority President Mahmoud Abbas, who has declared countless times that the PA has a duty to pay these allowances to terrorists – whether in prison, released from prison, killed while carrying out terror attacks – aka "martyrs" – and wounded under the same circumstance, and to their families. This, he says, is a national and social obligation and will not be stopped despite intense Israeli and international pressure to do so.[2]

In the past, the PA would disburse the funds to the recipients via banks operating in its territory. However, in the past year Israel amended military law in the West Bank to define the recipients' bank accounts as "terrorist property" subject to expropriation, and the administration of these accounts was now defined as punishable by law.[3] In advance of May 9, 2021, the date on which the amendment was to come into force, Palestinian and Arab banks operating in the West Bank began to freeze the accounts of prisoners and families of "martyrs" for fear of prosecution by the Israeli authorities.[4] The PA attempted to resolve this issue with the banks, but they maintained their refusal to pay out the allowances even though they were still receiving the funds from the PA treasury.[5]

After the PA also tried and failed to establish a PA-controlled "government bank" separate from the banking system to administer these bank accounts and thus evade Israeli penalties, it began to disburse the allowances via the PA postal bank. However, this method turned out to be inefficient, and it was argued that the long waits in line and the crowding at the post office to withdraw funds was undignified and humiliating to the prisoners and their families. This led to the introduction of a "new system," based, as noted, on setting up ATMs in some post offices and providing recipients with ATM cards for them.

PA daily Al-Hayat Al-Jadida article on the introduction of the new payment system for the families of "martyrs" and prisoners, July 7, 2021.

This report will review the PA's announcement of the new system for disbursing the allowances to the terrorists and their families and the families of "martyrs," and the PA's efforts in the past year to come up with this system.

The PA Inaugurates New Payment System For Allowances, Featuring The Mother Of Six Terrorists: "It Is Our Duty To Continue To Serve Members Of Our People, In Light Of The Sacrifices They Have Made"  

On July 6, 2021, the PA's Ministry of Telecommunications and Information Technology held a press conference at the postal system headquarters of the Ramallah and Al-Bireh district to announce the launch of a new payment system for these allowances.

The event was held with Telecommunications Minister Ishaq Sider, Commission of Detainees and Ex-Detainees Affairs director Qadri Abu Bakr, and "Umm Nasser," Latifa Abu Hamid, aka "the Palestinian Khansaa,"[6] the mother of six Fatah and Hamas terrorists involved in shooting and suicide attacks against Israeli civilians who are serving lengthy prison sentences in Israel and who is regularly honored by Fatah and PA authorities, including Abbas.[7] Abu Hamid opened the ceremony by thanking all those involved and expressing wishes for the removal of the Israeli occupation and the release of all Palestinian prisoners. During the ceremony, Minister Sider awarded her a certificate of honor and had her cut a ribbon to declare the launch of the new payment system.

Minister Sider explained at the conference that under the new system, the families of "martyrs," wounded, prisoners, and released prisoners would be able to access their allowances at ATMs set up at 20 branches of the PA postal bank across the PA districts using an ATM card. He added: "It is our duty to continue to serve members of our people, in light of the sacrifices they [our people] have made in order to attain independence and freedom. Until these are a reality, we must allow a dignified life for the [Palestinian] families, and particularly for the families of the prisoners, martyrs, and wounded. The prisoners deserve our concern for their families, and we will honor them. This is an obligation [for the PA] and there is no argument about it. We are proud to serve them."

Commission of Detainees and Ex-Detainees Affairs director Qadri Abu Bakr, who also spoke at the press conference, emphasized that the Palestinian leadership was determined to continue providing the allowances to the prisoners and their families despite the Israeli threat of punitive action against PA banks. He said: "In cooperation with the Telecommunications Ministry, the Palestine Monetary Authority, and the Treasury Ministry, we have come up with an easier system [for disbursing allowances], which will ensure the dignity of prisoners and their families. From now on, the families of prisoners can withdraw their salaries and allowances with a magnetic card, without stress or effort and without wasting a lot of time."[8]

Center: Telecommunications Minister Ishaq Sider; left: Detainees Affairs Commission director Qadri Abu Bakr; right: Latifa "Umm Nasser" Abu Hamid (Source: Facebook.com/MTITPalestine, July 6, 2021)

Latifa "Um Nasser" Abu Hamid opening the press conference (Source: Facebook.com/MTITPalestine, July 6, 2021)

Telecommunications Minister Sider awarding Latifa Abu Hamid with a certificate of honor (Source: Facebook.com/MTITPalestine, July 6, 2021)

Latifa Abu Hamid cutting the ribbon (Source: Facebook.com/MTITPalestine, July 6, 2021)

The PA's Extensive Attempts To Change The System For Disbursing Allowances

It should be noted that the new system for disbursing allowances to the recipients followed several months of attempts to find a way to do so, including organizational efforts by the PA.

As noted, the Palestinian leadership, headed by Mahmoud Abbas, has repeatedly declared that it has a duty to provide these allowances despite intense Israeli and international pressure to stop doing so. However, in late 2020 and early 2021, following a number of changes, the PA was compelled to look for a new system for paying out the allowances. The first change was an amendment to Israeli military law in the West Bank stipulating that the recipients' bank accounts at Palestinian and Arab banks in the West Bank were now considered "terrorist property" subject to expropriation, and that administering them would henceforth be defined as punishable by law. As a result of this amendment, Palestinian and Arab banks in the West Bank began freezing prisoners' accounts, and told the PA that they were refusing to continue to administer these accounts fear of prosecution by the Israeli authorities.

Another change that prompted the PA to look for alternate ways of disbursing the allowances was the election of U.S. President Joe Biden and the PA's desire to improve its image and establish good relations with the new administration. Accordingly, in November 2020 the PA had already begun to look at various ways of paying out the allowances, in some cases even by means of administrative circumvention such as redefining the allowances as "salaries" and "pensions," apparently by creating fictitious jobs for some of the released prisoners in the PA.[9] Commission of Detainees and Ex-Detainees Affairs director Qadri Abu Bakr said that as part of this plan, 5,000 of the 7,500 released prisoners would be defined as pensioners since they were aged 50 or over or were not physically able to work and would thus receive "pensions." He added that so far over 600 other released prisoners had been given jobs in the PA security apparatus, and also clarified that the families of the "martyrs" and of those still incarcerated would be able to withdraw their allowances from ATMs at post offices.[10]

Another idea that the PA tried was to disburse the allowances via a PA-controlled "government bank" instead of via the regular PA banks, which as noted had frozen the accounts for fear of Israeli and international penalties.[11] This "government bank" was meant to be separate from the Palestinian and international banking system, ostensibly eliminating the possibility of legal action against it. This idea was criticized by Palestinian economists who warned that it was unfeasible.[12] Thus, on January 14, 2021, Abu Bakr announced that the "government bank" idea had been scrapped because the Palestinian banks had refused to cooperate with it due to the threat of penalties.[13]

On March 23, 2021, Abu Bakr announced that during a meeting of the Treasury and Telecommunications Ministries and the Monetary Authority it had been decided to disburse the allowances via the postal bank, and that funds would be paid this way also to released prisoners who had not yet been given their jobs in the PA.[14] However, prisoners and their families have since complained about the disorganization and the long lines at the post offices under this new system, and stressed that getting their money like this was humiliating and insulting.[15]

It appears that the new payment system, i.e. using ATMs and ATM cards, is actually only a technical streamlining of the disbursement of allowances via the PA postal bank that is aimed at preventing criticism of the PA.