Palestinian President Mahmoud Abbas will declare the Hamas-led government as an interim administration until holding referendum next year, local Maan news agency reported on Thursday.

Well-informed sources were quoted as saying that Abbas was not going to sack the Hamas-led government, but the government will be called as an interim as a compromise.

The news came two days before Abbas address the nation. The sources termed as "inclusive and historical" the speech which Abbas will deliver on Saturday about the political crisis that worsened after Hamas took office in March.

According to the sources, Abbas will set March 2007 as time to call public referendum on holding early parliamentary and presidential elections.

In his speech, Abbas will vow to pay salaries for the 165,000 government employees from the National Fund that belongs to the Palestine Liberation Organization (PLO).

The Hamas-led government's failure to pay salaries and the financial crisis were the key objective that pushed Palestinian factions to look for a unity government.

International donors stopped funding the Hamas administration because it has refused to recognize Israel and renounce violence.

However, Ahmed Yousef, the political advisor of Prime Minister Ismail Haneya, has ruled out that Abbas calls for a referendum or early elections.

He expected that Abbas will talk in details about the situation in the Palestinian territories and the siege imposed on the people, warning against the negative results that would affect the whole Palestinian scene if early elections or referendum were called.

"The president is not authorized to call for referendum," said Yousef, stressing that any call for referendum would be considered illegal.

(Xinhua News Agency December 15, 2006)