Barak 'will not quit' over report

His decision comes after an official inquiry called the war a failure, but spared Mr Olmert serious criticism.

Mr Barak had threatened - depending on the report's findings - to demand Mr Olmert's resignation or early polls.

If Mr Barak had pulled Labor's 19 members from the coalition, Mr Olmert looked set to face new elections.

"Why am I staying? I'm staying in the post of defence minister because I know what kind of challenges face Israel," Mr Barak told reporters, before entering Sunday's weekly Cabinet meeting.

Political survival

Correspondents say the decision by Mr Barak - who joined the government coalition about a year after the Lebanon war - removes for now any threat to Mr Olmert's government.

The prime minister insisted he would not step down last Wednesday after the publication of the government-appointed Winograd inquiry.

Although the report did not blame Mr Olmert directly, it found the 34-day war against Hezbollah had been a "large and serious" failure.

The conflict broke out in July 2006, when Hezbollah fighters captured two Israeli soldiers and killed three others in a cross border raid.

If Mr Barak had quit, Mr Olmert's coalition would have been left short of the 61 MPs needed for a majority in the 120-member Knesset (Israeli parliament).

The defence minister's decision to remain in government may have been influenced by Labor's opinion poll ratings, say analysts.