Foreign Minister Penny Wong and International Development Minister Anne Aly have signed off on $25 million in new Australian funding for Gaza and the Palestinian Authority, five months after the US State Department formally determined the PA paid more than $200 million to convicted terrorists and their families in a single year.
The package, announced in a joint media release on Tuesday, 21 July, splits into $15 million for a UN fund rebuilding Gaza and $10 million for a World Bank fund that manages the Palestinian Authority's books. It goes out the door on top of Australia's existing humanitarian assistance, which had already passed $110 million for Gaza and Lebanon by mid 2025, and it goes out while Australian households are cutting back through a cost of living squeeze the same government keeps promising to fix.
Penny Wong's own release admits the PA hasn't delivered its reforms
The release says Australia will keep working with partners to hold the Palestinian Authority to the commitments it has made, then lists them: reform governance, terminate prisoner payments, institute schooling reform, demilitarise and hold general elections.
Every item on that list is still a promise, not a result. The money moves first.
"Strong, accountable and effective Palestinian institutions will be critical to future recovery efforts, regional stability and long-term prospects for peace," the joint release states.
Washington says the Palestinian Authority tried to dupe donors on pay for slay
The prisoner payments line matters most. For years the Palestinian Authority ran a scheme, known to critics as pay for slay, that paid salaries to Palestinians jailed for attacks on Israelis, with longer sentences earning bigger payments. PA president Mahmoud Abbas signed a decree in February 2025 that supposedly ended it.
In February 2026 the US State Department determined the PA paid more than $200 million to terrorists and their families in 2025, the same year Abbas claimed the scheme was dead, and accused Ramallah of trying to "dupe" the international community into believing the payments had stopped. A court in Ramallah has since ordered the PA to reinstate payments to a jailed prisoner, ignoring the reform decree entirely.
So the reform Penny Wong's release lists as a commitment is one Washington says was faked. Wong and Aly's release doesn't mention the State Department finding.
Where the $25 million of your money actually goes
The $15 million goes to the UN Horizon Fund, a trust fund launched on 13 July that pools UN agencies to rebuild water, sanitation, health, education and housing in Gaza, clear debris and reduce the risk from unexploded ordnance. Australia's contribution sits alongside more than $80 million pledged by France, Germany, Italy, the Netherlands, Norway, Sweden, Switzerland and the United Kingdom.
The $10 million goes to the World Bank's Palestinian Fund for Reconstruction and Development, a fund backed by Japan, the UK, Canada, France, Sweden, Switzerland and Iceland. Its job, in the release's words, is to strengthen the PA's "public financial management". In plain English, it's the fund that's supposed to teach the Palestinian Authority to handle money honestly, the same authority Washington says hid $200 million in terror payments from its donors last year.
The pattern is familiar. In June 2025 Wong and Aly announced a separate $10 million round for Gaza, split between Jordanian field hospitals and UNICEF, a package The Australian reported took Australia's total aid funding for Gaza and Lebanon past $110 million. This week's $25 million comes on top of all of it.
The UN's own Gaza record is why "whose hands" is a fair question
The Horizon Fund is not UNRWA, the UN's main Palestinian relief agency. But the UN's record of keeping Gaza aid clean is the reason donors ask hard questions. The UN's own investigators found that nine UNRWA staff may have been involved in the 7 October 2023 attacks on Israel, and the agency sacked them. Israel has repeatedly accused Hamas of seizing and taxing aid inside Gaza.
And when aid has moved outside Hamas's control, the group has been accused of attacking it. In June 2025 the US backed Gaza Humanitarian Foundation, set up specifically to stop Hamas stealing aid and selling it back to Palestinians, accused Hamas of ambushing a bus of its Palestinian aid workers, killing at least five of them and possibly taking others hostage. "Hamas would rather we die of hunger than let the American aid distribution system succeed," one Gazan said in a video released by the US nonprofit Centre for Peace Communications.
Canberra's answer to all of that is one line: funding will be delivered through "trusted international partners with robust oversight, accountability and safeguards to ensure Australian assistance is used for its intended purpose". The release doesn't detail what those safeguards are or who audits them.
The bodies paraded through Gaza on 7 October were cheered, not mourned
⚠️Warning: distressing image below.
One News has reported before on the footage of Shani Louk, the 22 year old whose half naked body was loaded into the back of a pickup truck and paraded through the streets of Gaza on 7 October 2023, where Palestinian crowds swarmed the vehicle, cheered, and young boys spat on her body.
There are innocent people in Gaza. But the celebration wasn't fringe. The Palestinian Centre for Policy and Survey Research, a Ramallah based pollster, surveyed Palestinians in the West Bank and Gaza in the weeks after the attack and found 72% said Hamas's decision to launch it was correct. The same poll found a vast majority denied Hamas had committed atrocities against Israeli civilians at all.
⚠️Warning: distressing video below.
Picture: X. Crowds swarm the ute and beat the dead bodies in the tray as others run behind filming, 7 October 2023.
That's the backdrop to the $25 million. Australians in the middle of a cost of living crisis are funding recovery for a territory whose own pollster recorded overwhelming support for the attack that started the war, through channels whose safeguards the government describes in a single sentence. It's worth turning the question around: if Australia were the one flattened and broke, would Tehran or Ramallah be wiring $25 million to help Australians? Nobody seriously expects that answer to be yes.
Hamas gets a lecture, Australian taxpayers get the bill
The release is firm on Hamas. It condemns the group's atrocities of 7 October 2023 and its ongoing terror, and says Hamas must disarm and play no role in the State of Palestine.
"This package demonstrates Australia's practical commitment to Palestinian recovery, reform and institution-building. Hamas can play no role in the State of Palestine," Wong said.
Aly said the funding "will help strengthen institutions, advance reform efforts and support communities as they work towards recovery and resilience".
The package builds on Labor's recognition of the State of Palestine in September 2025. The release commits Australia to holding the Palestinian Authority to its promises. It doesn't say what happens to the $25 million if those promises stay broken, and on the biggest promise of all, the United States government says they already are.
