The U.S. State Department issued a devastating report to Congress on the terrorism-plagued U.N. Relief and Works Agency (UNRWA) that provides aid to Palestinians in the Gaza Strip, determining that the agency needs to be abolished and is beyond reform.

According to a U.S. State Department public assessment to Congress that was independently obtained by Fox News Digital, “The Administration has determined UNRWA is irredeemably compromised and now seeks its full dismantlement.” 

DOSSIER REVEALS INFORMATION USED TO EXPLAIN UN AGENCY’S DEEP TIES TO HAMAS IN GAZA

According to the State Department document, the Trump administration demanded in March 2025 that UNRWA “return all remaining unspent balances of U.S. funding in its accounts.” The UNRWA Washington office said it would do so, “but has not yet completed the action.” In May, the State Department said it is working “to cease U.S. participation in all working-level UNRWA bodies” at the United Nations. 

The Washington Free Beacon first reported news of the State Department report.

The U.S. government pulled the plug on UNRWA funding in January 2024 and has not resumed aid to the corruption-scarred agency. Secretary of State Marco Rubio’s move calling for the wholesale dissolution of UNRWA adds a new layer of pressure on the U.N. and key donor nations to UNRWA (Japan and Germany) to reassess the viability of UNRWA.

The Biden administration had given UNRWA $1 billion in U.S. taxpayer funding since 2021 before the freeze in 2024 went into effect.

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Former Israeli Minister of Defense Yoav Gallant said in February 2024 that dozens of individuals employed by UNRWA were directly involved in the atrocities carried out against Israeli civilians on Oct. 7.

Israeli Ambassador to the U.N. Danny Danon told the U.N. in January that UNRWA must close its operations in Jerusalem.

In August 2024, Fox News Digital reported the U.N. fired nine employees from UNRWA who likely participated in the Hamas slaughter of 1,200 people, including more than 30 Americans, on Oct. 7 in southern Israel.

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Israel’s Knesset (Parliament) overwhelmingly banned UNRWA because of its reported support for Hamas terrorism. The U.S. has classified Hamas as a foreign terrorist organization. Israel, U.S. lawmakers, and watchdog organizations have also provided evidence to the U.N. over the years that UNRWA glorifies Palestinian terrorism and antisemitism. 

Fox News Digital sent press queries to the State Department and UNRWA.