Israel must give up land for peace: Olmert

"This government, any government, owes it to tell the truth and that truth will force us to separate from many parts of the homeland in Judaea and Samaria (the West Bank), in Jerusalem and on the Golan Heights," Olmert said in a speech to parliament.

"There were times when we wanted to seal our presence on every inch of land -- and I was one of those people -- but we were wrong."

Olmert was addressing a special session of parliament convened to mark the 13th anniversary of the assassination of Prime Minister Yitzhak Rabin by a Jewish extremist opposed to any territorial concessions to the Palestinians.

Earlier at a ceremony attended by leading Israeli politicians at Rabin’s graveside in Jerusalem’s Mount Herzl cemetery, Olmert made similar remarks about the need to give up land for peace.

"If we are determined to preserve the Jewish and democratic character of the state of Israel, we must inevitably relinquish, with great pain, parts of our homeland, and we must relinquish Arab neighborhoods in Jerusalem," he said.

He added however that this must include "the necessary amendments stemming from the realities created on the ground" -- a reference to Israel’s wish to retain the major Jewish settlements in the occupied West Bank.

"Waiting unnecessarily to make a decision will change the delicate balance in the international community which currently adheres to the notion of two states for two people with defined, agreed-upon, internationally recognized borders," he said.

Monday's special session of parliament was its last before snap elections are held on February 10.

Olmert drew sharp criticism from within his Kadima party after he made similar remarks last month.

"Mr Olmert’s remarks on the necessity of a territorial retreat from almost all the Palestinian territories go far beyond our positions of principle and are aligned with those of the extreme left," Tzahi Hanegbi, chairman of the parliamentary foreign affairs and defense committee, said at the time.

Yigal Amir, who is serving a life sentence for Rabin’s killing, never expressed regret.

"The shots fired in a cowardly manner in the back of Yitzhak have not killed the path to peace which he mapped out," Israeli President Shimon Peres said at the ceremony.

Former British Prime Minister Tony Blair, who is now a representative of the Middle East quartet of international peace mediators, was also among the dignitaries in attendance.

Rabin is revered as a national hero, both for his legendary career as army chief and for peace efforts in the 1990s that earned him a Nobel peace prize shared with Peres and the late Palestinian leader Yasser Arafat.