While a ministerial committee agonizes over which Palestinian security prisoners might be released in exchange for kidnapped Cpl. Gilad Schalit, the defense establishment is far from certain that Hamas wants a deal at all. Defense sources told The Jerusalem Post over the weekend that senior Hamas leaders regard holding Schalit, who was kidnapped on the Israeli side of the Gaza border in June 2006, as a kind of protection from IDF attacks on them. "Schalit is an insurance card for the senior Hamas leaders - that as long as they hold him, Israel will not assassinate them," one defense official said. "The moment he is released, [in the Hamas conception] there is nothing holding us back." Last week's Winograd Committee final report on the Second Lebanon War strongly urged that Israel not make "crazy deals" to secure the release of captured soldiers, since this only boosts terrorists' motivation to capture more. There has been a prolonged argument within the ministerial panel over precisely which security prisoners might be freed - a dispute centered on the criteria for defining Palestinian prisoners as having "blood on their hands." A list of 450 potential prisoners for release is being compiled for the committee, but its composition cannot be finalized until that definition is resolved. The committee is headed by Vice Premier Haim Ramon and comprises Foreign Minister Tzipi Livni, Public Security Minister Avi Dichter, Justice Minister Daniel Friedmann and Minister-without-Portfolio Ami Ayalon. During meetings held over the past six weeks, wide differences have emerged between Shin Bet (Israel Security Agency) head Yuval Diskin and Ofer Dekel, the prime minister's point man on the issue. While Dekel reportedly wants the criteria relaxed considerably to enable a deal, Diskin has been opposed. Ramon is understood to lean toward Dekel's stance. But the Prime Minister's Office denied suggestions over the weekend that Prime Minister Ehud Olmert was also now backing this line, and was focusing on the issue now that the Winograd Committee's report had been published, clearing the path for possible progress on a deal. Ramon's office declined to comment. Senior officials in the Prime Minister's Office said work on a possible exchange had been taking place long before the release of the Winograd Report. The issue would not be raised at Sunday's weekly cabinet meeting, they said, and they did not know when a list of prisoners for possible release would be brought to the cabinet by the ministerial committee. A list of names was reportedly presented to Olmert on January 10, but not passed on to the cabinet for approval. In a chapter devoted to the dilemmas of such exchanges, the Winograd Committee strongly warned against "crazy deals" in negotiations with terrorists that would only increase their motivation to abduct soldiers, and urged Israel to formulate a clear policy for dealing with instances of kidnapped soldiers. In the chapter "Kidnapping - A Strategic Threat," the Winograd panel said the lack of a formulated policy on how to deal with abductions of soldier was "a strategic mistake and even weakens Israel. As long as we appear vulnerable," it went on, "the price for the return of the soldier is higher and the motivation to kidnap additional soldiers increases." The report admiringly cited the US's declared policy of not negotiating with terrorists as having minimized the number of attempts to kidnap American soldiers. The Winograd Committee recommended that Israel engage in a dialogue with its allies and formulate a joint policy that would enjoy international legitimacy as well as global cooperation. On Friday, Damascus-based Hamas chief Khaled Mashaal told an Italian magazine, Panorama, that Schalit was being treated well and that Israel's recent military operations in Gaza Strip were hurting chances of a prisoner swap. "Gilad Schalit is alive. He is well and he is also being treated with kid gloves," Mashaal was quoted as saying. "Thanks to Egypt's mediation, we had already decided the number of prisoners and the place of the exchange. We were missing the names," he added. "But we will never do exchanges with those whose hands are stained with our blood." AP contributed to this report.