The inner cabinet statement said the decision had been reached only after "all the required legal procedures were exhausted" and after talks on a compromise with Palestinian officials in Orient House had failed. Mr Netanyahu said three offices in the Palestinian headquarters are acting as an arm of the Palestinian Authority, led by Yasser Arafat, and that this infringes Israeli sovereignty over Jerusalem and is a breach of the Oslo accords.
The decision by the Prime Minister to take over Orient House, a former hotel in East Jerusalem, is being widely criticised in private by foreign diplomats in Jerusalem, who see it as an attempt to seek a confrontation with the Palestinians before the Israeli elections on 17 May. A deadline of 7pm yesterday was set by the government for the closure of three Palestinian offices in the building, including that of Faisal Husseini, the Palestinian leader in Jerusalem. Talks were still going in an attempt to secure a last-minute compromise.
Avigdor Kahalani, the Public Security Minister, who has been trying to broker a deal acceptable to both sides, was quoted as saying: "Netanyahu is pressing to close the offices." Mr Kahalani asked: "Why put a pistol to Husseini's forehead if we can continue along a peaceful path?"
Dennis Ross, the US special envoy to the Middle East, was in touch by telephone with Mr Kahalani to try to defuse the crisis over Orient House. The Israeli compromise proposal was that Mr Husseini might remain in the building but not engage in political activity or receive diplomatic missions.
Mr Netanyahu has been seeking to make the future of Jerusalem an issue in the election, so far with little success. In the last election in 1996 he won a great deal of support by claiming that Shimon Peres, the previous prime minister, would "divide Jerusalem".
The Palestinians do not want to do anything that might help Mr Netanyahu to win the election but at the same time it is difficult for them to give up an important symbol of their claim to sovereignty over at least part of Jerusalem.
Meanwhile, Mr Netanyahu is falling further behind Ehud Barak, the Labour party leader, in the polls. According to a poll by Channel 2 television, Mr Barak is 8 points ahead in the first round and would win a run-off by 52 per cent to 40 per cent. Nevertheless many voters are still undecided and a majority of these are expected to end up supporting Mr Netanyahu.Reuse content