Israelis and Palestinians have both disputed claims by the US secretary of state that the Palestinian Authority will stop making payments to the families of Palestinians killed while attacking Israelis.

Rex Tillerson, America’s top diplomat, told the US Senate on Tuesday that the Palestinian Authority (PA) had agreed to stop the “martyr” payments, which even go to the families of suicide bombers and have been a major source of anger for Israel.

“They have changed their policy, at least I have been informed they’ve changed their policy,” Mr Tillerson said. “Their intent is to cease the payments of to the family members of those who have committed murder or violence against others.”

But within hours of Mr Tillerson’s statement, both Israeli and Palestinian officials said he was wrong.

“This is not true and this statement is an aggression against the Palestinian people,” said Issa Qaraqe, the head of the PA prisoners affairs department.

Qadare Fares, the head of the Palestinian Prisoners Club, an NGO that works with prisoners’ families and organises payments, said he was not aware of any changes to the payments policy.