Ceasefire Holds As Olmert Admits Tactical Deficiencies

Ehud Olmert tried to repair his frayed standing as a war leader yesterday by claiming his troops had inflicted lasting damage on Hizbullah and would continue to pursue the militia's leaders, despite a UN ceasefire.

The Israeli prime minister was defending his conduct during the war at a special session of parliament, called at a time of deepening public doubts over his leadership. He took full responsibility for the conflict, and admitted there were "deficiencies" in the way it had been managed.

Mr Olmert was speaking after a day in which a UN-brokered truce had mostly held, triggering a mass return by refugees to south Lebanon.

A few skirmishes broke out between Israeli troops and Hizbullah fighters left in close proximity when the truce began yesterday morning. Israel claimed to have killed six Hizbullah guerrillas.

But the skirmishes did not escalate into wider fighting, and, for the first time since the war began on July 12, the Israelis dropped no bombs and Hizbullah fired no rockets.

The Lebanese border villages remained all but lifeless. The muezzin's call to prayer could be heard in Metulla from the village of Kila, but no worshippers emerged from the shell-damaged streets. The only vehicles to be seen were white UN supply trucks and armoured cars, visiting observation posts along the border.

Ignoring Israeli warnings not to travel, thousands of displaced residents from south Lebanon clogged the roads on their way home as Hizbullah distributed glossy leaflets, labelled Divine Victory, showing fighters by a rocket launcher.

Mr Olmert's victory claim was more nuanced. He told the Knesset that the Israel Defence Force (IDF) had crippled Hizbullah's capacity to fight and that the militia would no longer be able to act like a "state within a state as an arm of the axis of evil". He said the "strategic balance" in the region had shifted against Hizbullah.

His speech was interrupted by heckling from three Knesset members who were removed from the chamber. Mr Olmert's popularity took a serious dent in the last week of the war, as IDF generals privately complained he had held them back for a month before unleashing a full-scale invasion.

The prime minister's principal rival on the right, the Likud leader, Binyamin Netanyahu, said there had been "very many shortcomings" in the country's war readiness and the conduct of the fighting, echoing popular opinion that a full-scale ground invasion should have been ordered earlier.

Mr Netanyahu also used the occasion to attack the government's policy of unilaterally withdrawing from the West Bank. He said experience in Lebanon, from where Israel withdrew six years ago, showed that the policy gave the country's enemies "a tactical advantage".

The Olmert government has promised an inquiry into the lead-up to the war and its conduct. "We won't sweep things under the carpet," Mr Olmert said, but he warned his country against becoming engulfed in internal disputes, and to remain vigilant against future attacks.

Hizbullah's leaders would not be able to rest, he said. "We will continue to pursue them everywhere and at all times. We have no intention of asking anyone's permission."

Israel kept up its psychological offensive yesterday, dropping leaflets over Lebanese cities claiming that Hizbullah and its Syrian and Iranian backers had brought destruction on Lebanon.

"Will you be able to pay this price again?" the leaflets asked.

Israeli and Lebanese army officers held preliminary talks with the UN monitoring force, Unifil, about the proposed replacement of Israeli troops by Lebanese government soldiers backed up by UN reinforcements.

Talks on the UN mandate were under way in New York yesterday, but the reinforcements are not likely to arrive for at least 10 days. In the interim, the maintenance of the truce will depend on Israel and Hizbullah.

The UN secretary-general, Kofi Annan, urged both sides yesterday to "move swiftly" to convert the truce into a lasting ceasefire.

The day's quiet brought the remaining residents in northern Israel out of their shelters to carry out chores postponed for a month, including harvesting over -ripe fruit. "It is great to be able to walk in the open without fear," said Adi Mano, a 27-year-old from Haifa who had been entertaining children in the air raid shelters.

The Israeli army claimed to have withdrawn a battalion from Lebanon, but at Metulla the only movement out of Lebanon was by a transporter carrying three destroyed armoured carriers covered in tarpaulins which did not quite hide their blackened hulls.