Khaled Meshaal, head of the Islamist group’s political bureau, was backed by moderate Palestinian leaders. He said of Ehud Olmert’s proposals: “This is not a peace plan but a war declaration which will permit Israel to stay in the largest section of the West Bank, to maintain their wall and settlements, to refuse all concessions on Jerusalem and to reject the Palestinians’ right of return.

“It is a unilateral disengagement by Israel in the interest of its security needs and not the demands of peace.”

Mr Olmert has outlined plans for Israel to retain control of West Bank Jewish settlement around Jerusalem and Tel Aviv while withdrawing from dozens of smaller, isolated ones, effectively converting its controversial West Bank barrier into a new border.

“At the end of the process we will reach a complete separation from the vast majority of the Palestinian population,” he told the Hebrew daily Maariv.

“The fence that will be built . . . will be the border line that will separate Israel and the Palestinians. Israelis will not live beyond the fence.”

Key to his plan is retaining control over the Jordan Valley and the settlements of Maale Adumim, Gush Etzion and Ariel, which slice up to 13 miles into the West Bank area, which has been held by Israel under military occupation since 1967.

The land is claimed by Palestinians for their future state but Israel has refused to deal with the Palestinian Authority after Hamas — which it regards as a terrorist group — won power in parliamentary elections.

Mr Olmert threatened yesterday to assassinate Ismail Haniyeh, Hamas’s candidate for Prime Minister, if he involved himself in violence. “Anyone who is involved in planning terror attacks will be a legitimate target for liquidation,” he told the Yediot Ahronot newspaper.

The flurry of announcements come ahead of elections in Israel on March 28. Mr Olmert’s ruling Kadima Party is the front-runner, but its lead has slipped in recent weeks.

Palestinians have called for a resumption of peace talks. But Mr Olmert, facing intense pressure from right-wing critics during campaigning, has even dismissed talk of meeting the moderate Palestinian President Mahmoud Abbas, saying there is little point if the Palestinian Authority is now dominated by Hamas.

European Union foreign ministers met in Salzburg yesterday and warned Hamas that it must be a “reliable partner” and recognise Israel, renounce violence and respect past agreements if it wanted the EU to continue funding the Palestinian Authority.

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