The Sydney Morning Herald

Stephen Smith has joined a chorus of international criticism of Israel over its controversial approval of thousands of new settler homes, which threatens to scupper US-brokered Middle East peace talks.

Analysts said the strong language of the Minister for Foreign Affairs was a departure from Australia's record of ''playing it safe'' on Israeli politics. It follows the straining of Australia-Israel relations after the forgery of four Australian passports used in the assassination of a Hamas figure in Dubai, allegedly by the Israeli intelligence agency Mossad.

Federal police investigating the passport incident are believed to have returned to Australia, but yesterday Mr Smith's office said he had not yet seen their report.

The Israeli government has blamed the announcement of 1600 new homes by its interior minister - just as the US Vice-President, Joe Biden, arrived in Jerusalem and days after the Palestinian Authority had agreed to indirect talks - on a bureaucratic mishap.

The White House has condemned the announcement as undermining the peace process. Mr Smith told Sky News yesterday: ''This is a bad decision at the wrong time, and it's not a helpful contribution to the peace process.''

Britain, the European Union, France and Egypt also condemned Israel's move. But Brendon O'Connor, associate professor in American politics at the University of Sydney's US Studies Centre, said it was a departure for Australia to criticise Israel.

''Australia has previously played this issue very safe compared to a lot of European countries,'' he said. Jeremy Pressman, an American post-doctoral fellow at the centre who specialises in the Arab-Israeli conflict, said the passport tension was likely to be a factor in Mr Smith's rebuke but the broader international community had been angered by the timing of the announcement.

''It is traditional Israeli coalition politics and a long-running way to poke the US in the eye,'' Dr Pressman said.

Mr Smith has told the Israeli ambassador that lack of co-operation with the federal police investigation could bring adverse consequences but has said he will read the report before drawing conclusions.