A future Palestinian prime minister must be given the authority to form a new Cabinet and formulate policy, the Palestinian parliament speaker said Wednesday in what appeared to be a challenge to Yasser Arafat . Earlier this month, Arafat reluctantly agreed - under intense pressure from Mideast mediators - to create the position of prime minister, which would mean sharing power for the first time in nearly four decades as Palestinian leader.

However, Arafat is widely expected to either try to delay the naming of a prime minister, weaken his powers or appoint someone with little clout.

The prime minister's job will be defined by the 88-member Palestinian legislature, which will need a two-thirds majority to create the position.

Parliament Speaker Ahmed Qureia said Wednesday that the prime minister, once appointed by Arafat, should have real powers, including forming a new Cabinet and formulating government guidelines - tasks performed until now by Arafat.

"The prime minister will be responsible for the government, and it is he who should form the government," Qureia told The Associated Press.

Qureia said this should not be interpreted as a challenge to Arafat. However, other officials, speaking privately, said the intention was to limit Arafat's authority and carry out real reform.

The leading candidate for prime minister is Arafat's deputy in the PLO, Mahmoud Abbas, who has the support of Arafat's Fatah  movement. Qureia also endorsed Abbas, a moderate who calls for an immediate halt to attacks on Israel.

The so-called Quartet of Mideast mediators - the United States, the United Nations , the European Union and Russia - wants to sideline Arafat in hopes of accelerating internal reforms and restarting peace talks.

The Quartet did not seek a Cabinet overhaul when it pushed for the naming of a prime minister earlier this month.

The U.N. envoy in the area, Terje Roed-Larsen, proposed that Arafat create the position by presidential decree, instead of going through the legislature, but the idea was rejected.

The convening of the legislature in the West Bank town of Ramallah is now up to Israel which has blocked such sessions in the past, citing security concerns.

Raanan Gissin, an adviser to Prime Minister Ariel Sharon , said Wednesday that legislators suspected of involvement in violent activity would not be allowed to attend a meeting of the legislature. "No one is preventing them (the legislature) from meeting. The prevention is of those people who are involved in terror," Gissin said.

However, Qureia said Israel has not granted approval for the legislature to meet, and that he was waiting for the Quartet to obtain the permission.

Palestinian legislator Ziad Abu Amr said lawmakers have been meeting informally to forge a joint position on the prime minister's job description, with considerable disagreements emerging.

"I think there will be a two-thirds majority ... to create the position of prime minister, but I think there will be a lot of debate on the responsibilities of the prime minister," Abu Amr said.

PHOTO CAPTION

Palestinian leader Yasser Arafat  smiles during a meeting at his headquarters in the West Bank town of Ramallah Thursday Feb. 20, 2003.(AP Photo/Palestinian Authority Handout/Hussein Hussei