JERUSALEM, June 11 (Reuters) - Israel's cabinet on Thursday referred a plan to allocate 1 billion shekels ($339.7 million) for the establishment of new settlements in the occupied West Bank to the security cabinet, deferring a vote on the funds, Israeli anti-settlement group Peace Now said.
The plan was promoted by far-right finance minister Bezalel Smotrich, a proponent of Israeli settlement expansion who has said he wants to bury the idea of Palestinian statehood.
Palestinians and many countries view the settlements as a primary obstacle to peace, saying they eat into West Bank land that could form a potential Palestinian state. Settlement expansion has been accompanied in recent years by a rise in settler violence, with settlers staging sometimes deadly attacks on Palestinians.
A spokesperson for Smotrich said the ministers approved the budget framework for the settlement expansion but it was decided that the security cabinet "will decide how to distribute" the funds. It was not clear when the security cabinet would take its vote but Peace Now said it would convene on Sunday.
According to Israeli Prime Minister Benjamin Netanyahu's cabinet schedule, ministers were expected to discuss the establishment of temporary sites that have already been approved in the West Bank.
Netanyahu's office did not immediately respond to a request for comment.
The cabinet, however, approved a five-year, 4 billion shekel plan for regional development in a number of towns such as Nazareth in the Galilee region, home to many Arab citizens. It also approved 180 million shekels for new neighbourhoods in Israel's south.
FUNDING FOR ROADS, WATER, RIGHTS GROUP SAYS
About 700,000 Israeli settlers live among 2.7 million Palestinians in the West Bank and East Jerusalem. Israel annexed East Jerusalem in 1980, a move not recognised by most countries, but has not formally extended sovereignty over the West Bank.
U.N. bodies and most countries view the West Bank settlements as illegal, citing international conventions. Israel disputes this, saying a Jewish presence has existed in the West Bank for thousands of years.
In a statement, Peace Now said the planned cabinet vote would bypass the standard settlement planning process. It said the settlements in question had been approved by Netanyahu's government over the past three years.
Peace Now said the government was seeking to "set facts on the ground" ahead of elections expected in the coming months that would be difficult for a future government to undo.
Both Peace Now and the news website Axios, citing a draft resolution, said the funds would cover construction of infrastructure such as roads, land preparation, sewage systems, water connections and related works, as well as temporary residential compounds.
A spokesperson for Smotrich, the finance minister, did not provide specifics but said the cabinet vote would strengthen Israeli settlements and that these are not new settlements, but rather existing sites.
Smotrich last week announced a major expansion by more than 2,000 homes of three Jewish settlements in the West Bank.
($1 = 2.9439 shekels)
(Reporting by Steven Scheer; Additional reporting by Alex Cornwell; Editing by Kevin Buckland and Sanjeev Miglani)
