Senior Shin Bet security agency officials have warned Israeli political leaders that the Palestinian Authority is showing signs of unraveling, Israeli television reported, as Prime Minister Benjamin Netanyahu held a “situational assessment” on the West Bank.

According to Channel 12 news, Shin Bet officials warned that the unraveling of the PA would raise the risk of a “flare-up” in the West Bank — a front that Israel’s security establishment has largely managed to keep quiet over the past two years.

The security officials reportedly voiced concern that the PA is facing severe economic strain, saying that “unemployment is rising, security personnel are receiving little or no pay, and core functions are eroding. These factors could trigger chaos and a flare-up.”

In internal discussions, the Shin Bet has argued that since the PA’s survival ultimately serves Israel’s interests, steps should be taken to prevent its collapse, including restoring funds the cabinet decided to withhold from the PA, the report continued.

While such a move is strongly supported by the international community, far-right Finance Minister Bezalel Smotrich remains firmly opposed to it, the network noted.

Since May, Smotrich has entirely halted tax transfers to Ramallah, which, according to an Israeli official, were aimed at punishing the PA for a decision made by the United Kingdom to sanction him and fellow far-right minister Itamar Ben Gvir. Roughly NIS 900 million ($270 million) have been withheld since May alone.

In recent years, Israel has deducted large sums from the monthly transfers, saying they are equivalent to the funds that the PA had been sending to the families of Palestinian security prisoners and those killed carrying out attacks against Israelis — a policy that PA President Mahmoud Abbas instructed be terminated earlier this year.

In June, Ramallah invited the US to certify that the policy eliminating the so-called pay-for-slay system is now in place, though the Trump administration has yet to send a delegation to Ramallah.

The Shin Bet declined to comment to Channel 12 on “matters discussed behind closed doors.”

Meanwhile, Hebrew-language media outlets reported that Netanyahu was set to gather top ministers and aides for a discussion to explore the possibility of applying Israeli sovereignty to parts of the West Bank.

However, an Israeli official denied that Thursday’s meeting was on annexation and said that the matter is not on the formal agenda.

Smotrich, who will attend the meeting on Wednesday, unveiled a proposal for Israel to annex 82 percent of the West Bank.

The plan would constitute a departure from how the West Bank has long been governed. Israel has controlled the territory since it captured it from Jordan in the 1967 Six Day War. For more than three decades, the Ramallah-based PA has governed day-to-day affairs in Palestinian population centers.

The territory is now estimated to be home to more than 500,000 Israeli settlers, in addition to millions of Palestinians. Much of the international community says Israel is illegally occupying the West Bank and views the settlements as a violation of international law, which Israel disputes.

Earlier this year, the Knesset approved a non-binding motion to annex the West Bank by a vote of 71-13.

While dodging the question regarding Washington’s stance on the controversial move during a press conference in Ecuador, US Secretary of State Marco Rubio claimed the US predicted that Israel would take such steps in response to Western countries recognizing the State of Palestine.

“We told all these countries…. ‘If you do this recognition stuff’… there [isn’t] going to be a Palestinian state, because that’s not the way a Palestinian state is going to happen — [by having] a press conference somewhere, and we told them that it would lead to these sort of reciprocal actions, and [that] it would make a ceasefire harder,” Rubio said.

“As far as what you’re seeing with the West Bank and the annexation, that’s not a final thing. That’s something that’s being discussed among some elements of Israeli politics,” he added.

“We’re watching it closely. I’m not going to opine on it today,” Rubio said.

Rubio then reiterated his claim that the July 24 French announcement that it would recognize a Palestinian state at the UN in September led Hamas to raise its demands in negotiations — an assertion that Arab diplomats have disputed to The Times of Israel, explaining that Hamas had submitted its response that day — one that was rejected by Israel and the US — several hours before the declaration out of Paris.

The secretary of state was also asked about his decision last week to bar the PA’s leadership from attending the UN General Assembly later this month and whether Washington views the PA as illegitimate

“The Palestinian Authority has its own set of problems,” he said, highlighting Ramallah’s “pay-for-slay” system.

While the PA is engaging in an international diplomatic blitz aimed at convincing the Trump administration to reverse the decision, they are not pushing for the gathering to be moved outside the US if Washington does not budge, a Palestinian official said.

Ramallah is hoping Saudi Arabia and other allied countries will succeed in convincing the US to reverse its visa ban, since in addition to hoping to speak during the UNGA’s high-level week, Abbas was planning to address a conference being organized by France and Saudi Arabia on September that is aimed at promoting a two-state solution and will see several major Western countries announcing their respective recognitions of a Palestinian state.

The Palestinian official said that if the effort falls through, Ramallah’s contingency plan is for Abbas to address the two-state solution conference virtually — as was first reported in The New York Times.

In 1988, world leaders decided to move the General Assembly session to Geneva, after the US barred the entry of then-PLO chairman Yasser Arafat.

Channel 12 also reported Thursday that after Belgium declared Smotrich and Ben Gvir personae non gratae, Brussels began working to extend the ban across all 29 European states that are members of the Schengen Agreement.

The Schengen framework abolished internal border checks, enabling free movement within Europe. But it also requires enforcement against those barred from entry. A senior Belgian Foreign Ministry official told the network that Belgium intends to push for Smotrich and Ben Gvir to be denied entry throughout the entire Schengen zone.

While the final decision would still rest with each border officer, Belgium aims to see the ban applied consistently across all the countries, the report continued.

Belgian Foreign Minister Maxime Prevot unveiled the ban on the “two extremist Israeli ministers” on Tuesday, alongside his announcement that Belgium will recognize a Palestinian state at the United Nations General Assembly later this month, adding that sanctions will be imposed on the Israeli government.

The Netherlands and Norway have already barred the two Israeli ministers.