The Palestinian government in Ramallah condemned Israel's authorization on Monday of dozens of new housing units for a settlement near Bethlehem just hours before US envoy George Mitchell arrived in the region.

The Israeli government will allow the building of 112 new homes in the illegal West Bank settlement of Beitar Illit settlement, in spite of a declared halt to settlement expansion in November, Israeli media reported on Monday.

In a post-meeting statement, the Palestinian Authority cabinet, led by caretaker Prime Minister Salam Fayyad, urged the international community to put pressure on Israel to end the "settler chaos" in the West Bank and to protect Palestinians from attacks.

The condemnation followed remarks by the PLO's chief of Jerusalem affairs, Ahmad Qurei'a, who denounced the latest settlement expansion in the occupied Palestinian territories, stating that it undermined renewed US peace efforts.

Israel's announcement came on the eve of US Vice President Joe Biden's arrival in the country, attempting to rebuild Middle East peace efforts after the PLO Executive Committee agreed to US-backed proximity talks with Israel.

US Middle East envoy George Mitchell arrived on Saturday, as indirect talks are set to begin. Negotiations were broken off in December 2008 when Israel launched its assault on the Gaza Strip.

While the PLO agreed Sunday to indirect talks with Israel, assigning a four-month deadline, it has repeatedly called for a halt to all settlement construction, particularly in East Jerusalem, before returning to talks. The occupied eastern part of the city was not included in Israel's 10-month halt, sparking Palestinian and international condemnation.

At the cabinet meeting, ministers praised the work of the Central Elections Commission in preparation for municipal voting in July. The cabinet urged Palestinians to register for the elections by 16 March before the registration period ends.

Fayyad reviewed the proposed budget for 2010, and gave his preliminary approval for a 3.13-billion dollar sum, half of which allocated for the Gaza Strip, which has operated under a Hamas-led government since 2007.

The Ramallah-based prime minister and minister of finance said the main goal in the coming period would be to reach a point where the PA could cover its needs solely by collecting local taxes. Officials expect revenues to increase by 20 percent this year, largely thanks to administrative reforms in tax collection and economic growth, the cabinet statement said.

According to the minister of finance, approximately 1.9 billion US dollars of international aid will be required for the coming term. He said the PA expected donor countries to fund the deficit in its entirety.