A day after forcing the Construction and Housing Ministry to “reconsider” preliminary work toward building 24,000 housing units beyond the Green Line, Prime Minister Binyamin Netanyahu said Wednesday that building in settlements would continue, but had to be done wisely.

“In recent months, we built thousands of homes in Judea and Samaria, and in the coming months we plan to build thousands more,” Netanyahu said in a Knesset debate on housing prices. “It was never easy, but we did it responsibly despite international pressure.”

However, he said – in an apparent criticism of Construction and Housing Minister Uri Ariel’s decision to ask for the preparatory work needed long before issuing tenders for homes in the West Bank – “there’s no point in creating friction with the international community over theoretical potential and plans that aren’t applicable.”

“At the moment, there’s no point in wasting resources, energy and political capital on something that won’t have a real result. That hurts settlements.

We need to fight for real, true, practical things and not things that create unnecessary tension with the international community that can hurt our fight against Iran,” he added.

After coming under intense pressure, Netanyahu late Tuesday night directed Ariel to reconsider the move – including hiring an architect to plan in detail a new neighborhood in the area known as “E1,” linking Ma’aleh Adumim to Jerusalem – because of a desire not to deflect attention from efforts to reach a better deal with Iran.

Ariel’s plans, had they been allowed to stand, would likely have complicated ties with the US, France, Germany and Britain at time when Jerusalem was pushing those countries to take a tougher stand in their talks with Iran.

Intelligence Minister Yuval Steinitz, however, denied that Netanyahu had with his own hands created a link – long denied by Jerusalem – between the settlement issue and efforts to stop Iran from getting nuclear arms.

“There is no linkage,” he said.

“What Netanyahu is speaking about is not real linkage. What he says is that we shouldn’t allow ourselves to focus now on other issues, because we have very limited time to do our best to convince the world not to sign on this bad deal, or at least to dramatically improve it.”

One government official said that Netanyahu stepped in on this matter because he “wants everyone to understand that we are in a challenging period, and that in this complex international environment policy makers must act with prudence and caution.”

Once Netanyahu issued the statement about his instructions to Ariel, pressure about the matter faded immediately, the official said.

Ariel, meanwhile, said on Channel 2 that “there were no [building] tenders, no construction and no reprimand.”

He said what was being discussed was preparing for planning of units that – in the most optimistic scenario – were six or seven years from even “one of them” being built.

Ariel said Netanyahu, whom he met both Tuesday and again on Wednesday, explained to him the sensitivity of the situation with Iran, and request he be “sensitive and act accordingly.”

Opposition leader Shelly Yacimovich (Labor), speaking in the Knesset, called the government “all talk,” but commended Ariel for being the one minister who gets things done.

“I know him. He’s going to really build in the settlements – in the middle of a crisis in our relations with the US, in the middle of what appears to [the government] pretending to negotiate with the Palestinians,” she emphasized.

Yacimovich said she doesn’t buy reports that Netanyahu was angry at Ariel for distracting world attention from Iran when his representative in peace talks, Yitzhak Molcho, is arguing with Justice Minister Tzipi Livni and US Secretary of State John Kerry has warned that keeping the status quo will bring a third Intifada.

In the Knesset debate, MK Moshe Feiglin (Likud) and Deputy Transportation Minister Tzipi Hotovely suggested construction in the West Bank as a solution for rising housing prices.

Meanwhile, the Knesset Economics Committee on Wednesday approved an additional NIS 50.5 million for the local authorities in Judea and Samaria, of which NIS 10m. are to be spent on security and NIS 4.5m. on development.

The remaining NIS 36.5m. are reimbursement funds for money the local authorities lost in fees and other construction related revenues during the 10 month moratorium on housing starts in Judea and Samaria that ran from November 2009 to September 2010. The moratorium froze projects on which construction was about to begin and for which contractors would then have paid fees to the local authorities.

The absence of these fees effectively cut the budget of the authorities during those months. These funds are to make up for that shortfall.

According to Yigal Delmonti, the spokesman for the Jewish Communities of Judea and Samaria, the vote was technical and followed Knesset approval for the transfer.

Tovah Lazaroff contributed to this report.

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