U.S. President George W. Bush implored senior cabinet ministers at a dinner yesterday evening to work to promote the peace process, telling them that the current situation cannot continue and efforts to achieve a peace treaty must be made.

Earlier, Bush made statements summing up his visit to Israel and the Palestinian Authority. "There should be an end to the occupation that began in 1967," Bush said, presenting an outline for solving most of the core issues, which would include a compensation mechanism for Palestinian refugees, a contiguous Palestinian state, and secure and defensible borders for Israel.

Bush met with the ministerial forum at a dinner in his honor hosted by Prime Minister Ehud Olmert at his official residence in Jerusalem. One of the president's messages was about domestic Israeli politics. "Take care of Olmert, so he will stay in power," Bush said. "He's a strong leader. Israeli politics is like karate, you never know when the next chop will come."

Olmert said at the dinner that the peace process must go forward. Vice Premier Haim Ramon agreed with Bush's statement on the necessity of creating a Palestinian state. "Israel's problem is the occupation, which jeopardizes [our existence as] a Jewish and democratic state," Ramon said. "That's not the Palestinians' problem, that's our problem."

Shas chairman Eli Yishai, the minister of industry, labor and trade, raised reservations, telling Bush, "I appreciate your visit and your concern for Israel but we cannot make peace with half of the Palestinian nation, while Abu Mazen [Palestinian President Mahmoud Abbas] does not control the Gaza Strip."

Yishai recited several psalms emphasizing the importance of Jerusalem and said he would not compromise on the unity of the capital.

Acting against the wishes of the prime minister, Yishai gave Bush a letter from Shas spiritual leader Rabbi Ovadia Yosef urging the release of convicted U.S. spy Jonathan Pollard, as well as a letter from Pollard's wife, Esther.

Israel sees Bush's push for reaching a peace treaty with the Palestinians within a year as a positive step, an Israeli official said yesterday.

"We see the Bush remarks as the basis of moving forward. We accept them. We see them as consistent with understandings with the Americans and as a positive foundation for moving forward," said the official, speaking on condition of anonymity.

The Israeli response was the first to Bush's call for an end to what he said was the 40-year "occupation" of the West Bank, and for signing a peace treaty before he leaves office in January 2009.

Bush's comments marked a hardening of his tone toward Israel and could put Olmert at odds with right-wing members of his coalition who oppose sweeping peace concessions.

After returning from Ramallah to Jerusalem yesterday afternoon Bush read out a summary of his visit, laying out his vision for resolving such issues as the Palestinian refugees, which he said would be resolved by the creation of a Palestinian state and compensation.

"I believe we need to look to the establishment of a Palestinian state and new international mechanisms, including compensation, to resolve the refugee issue," Bush said.

"The agreement must establish Palestine as a homeland for the Palestinian people, just as Israel is a homeland for the Jewish people.

"These negotiations must ensure that Israel has secure, recognized, and defensible borders," he said. "And they must ensure that the state of Palestine is viable, contiguous, sovereign and independent."

Bush also named Lt.-Gen. William Fraser to monitor the Israeli-Palestinian road map for peace, the White House said yesterday. Fraser, who is Assistant to the Chairman of the Joint Chiefs of Staff, will "help monitor road map commitments", White House spokesman Gordon Johndroe said.

Meanwhile, senior PA officials expressed satisfaction with Bush's statements in Ramallah yesterday, even though the visit resulted in no major achievements for the Palestinians. They emphasized his call for an end to the Israeli occupation and to Israeli building in the settlements and in favor of a peace treaty by the end of the year.

The head of the Palestinian parliament's foreign policy committee, Abdallah Abdallah, told Haaretz yesterday that, "The first seven years of Bush's presidency were wiped out as far as we're concerned ... he changed, but we can't expect him to be Santa Claus and to bring us a state for the New Year."