Israel and the Palestinian Authority are scheduled to formally begin negotiations on the core issues - Jerusalem, settlements, refugees, borders, security and water resources - on Monday, in a move that poses a clear challenge to Strategic Affairs Minister Avigdor Lieberman. Lieberman, who has said he would leave the government if the core issues were discussed, is scheduled to meet with Prime Minister Ehud Olmert on Monday or Tuesday. The Israeli negotiation team will be headed by Foreign Minister Tzipi Livni, and the Palestinian team will be led by former PA prime minister Ahmed Qurei. The Jerusalem meeting follows an announcement by Olmert and PA President Mahmoud Abbas just prior to US President George W. Bush's visit last week that the two sides would commence core issue talks immediately. During a speech in Ramallah, Abbas said discussions would begin on the six issues. "If we reach an agreement on all these issues, then we can say that we have reached a final agreement," Abbas said, stressing that a peace treaty must resolve disputes over all the issues. An Israeli diplomatic official confirmed the talks would take place, and said it would serve as a "kick-off" to the core issue negotiations. The official said that since the Annapolis conference in late November, Livni and Qurei have dealt with procedural issues, and from now on would deal with substance. The official said the formalities of how exactly these talks would be carried out, as well as what role the Prime Minister's Office and the Foreign Ministry would play in preparing for the talks and coming up with position papers, still had to be finalized. In his speech Sunday, Abbas said, "We told President Bush that we can't move ahead in negotiations while settlement activities are going on. We can't have negotiations while they are building houses all over." Abbas criticized Hamas for allowing rockets to be fired from Gaza, saying this hurt the Palestinians more than the Israelis. He also said that if Hamas relinquished power in Gaza, he would begin talks with them "even if the Americans reject that." Olmert has warned that if Abbas forms another national unity government with Hamas, as was the case before Hamas overran Gaza in June, then the diplomatic process would come to an end. In a related development, Abbas met in Ramallah with Canadian Foreign Minister Maxime Bernier, who pledged $300 million in new aid to the Palestinians, according to a statement from the Canadian government. Bernier said the money, to be allocated over the next five years, would be used for security and government reform. He said the pledge coincided with the pledge Olmert and Abbas made to aim for a peace treaty this year. "While ambitious, I believe this is attainable," said Bernier, who was making his first visit to the region since becoming foreign minister in August. Bernier said the aid would be directed to Palestinian efforts to "promote tolerance and combat hatred and the incitement of violence," according to the statement. After meeting PA Foreign Minister Riad Malki, Bernier warned that Canada's aid was "not unconditional. We will need to see demonstrable progress in negotiations by both sides, as well as progress in Palestinian reforms." Bernier also met Olmert on Sunday and was briefed on Bush's visit. The two men also discussed the steps being taken by the international community to prevent Iran from developing nuclear weapons, according to Olmert's office. AP contributed to this report.