ISRAEL confirmed yesterday that it has approved hundreds of new illegal settler homes in occupied East Jerusalem after rightwingers slammed new housing for Palestinians.

An anonymous official confirmed Sunday’s reports that 800 new units would be built in the West Bank settlement of Maale Adumim and in the East Jerusalem settlements of Ramot, Gilo and Har Homa.

The plan also called for more than 600 new homes in the segregated Palestinian Beit Safafa district of East Jerusalem.

Israeli settlement watchdog Peace Now said on Monday that it endangered “both the possibility for peace and two states and the security of Israeli citizens.”

But hardliners in the Israeli cabinet attacked the plan to build homes for Palestinians in the city, complaining it would jeopardise Israeli settlement of the hoped-for capital of a future Palestinian state.

Education Minister Naftali Bennett, leader of settler extremist party Jewish Home, called the plan “a Palestinian arrow in the heart of Jerusalem” that would “divide Jerusalem de facto.”

Jerusalem Affairs Minister Zeev Elkin said: “Anyone who cares about a Jewish majority in the capital of Israel can’t promote construction for the Arab population alone,” the Haaretz newspaper reported.

On Sunday Mr Elkin told the pro-settler Land of Israel caucus in the Knesset that the new Israeli land-grab was a “vital” response to recent attacks on settlers.

“Terrorism will only end when they understand that we are here to stay,” caucus co-chairman Yoav Kisch said.

Israeli occupation forces have waged a brutal campaign of house demolitions this year, particularly in and around East Jerusalem. It is effectively impossible for Palestinians to get planning permission from Israeli authorities.

A report last week by the Middle East Quartet — the US, EU, Russia and United Nations — failed to classify Israeli settlements as illegal and instead blamed Palestinian “incitement” for the wave of attacks on occupation forces and settlers that began last year.

Palestine Liberation Organisation Saeb Erekat slammed the Quartet’s “attempts to equalise the responsibilities between a people under occupation and a foreign military occupier.”