The speaker of the European Parliament spoke before the Knesset on Wednesday and urged Israel to release funds to the Palestinian Authority and to free dozens of Palestinian lawmakers it has arrested.

Coupling his plea for the jailed politicians with a call for the release of three Israel Defense Forces soldiers and a British journalist, all believed held by Arab militants, Hans-Gert Poettering told the Knesset that Europe stood by Israel and was ready to work to promote new talks to bring peace and security to the region.

"The situation seems critical in a way that it has not for a long time," the German Christian Democrat legislator said.

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"The European Parliament calls on the one hand for the release of the abducted Israeli soldiers, Ehud Goldwasser, Eldad Regev and Gilad Shalit, as well as of the British correspondent Alan Johnston, and on the other for the imprisoned members of parliament and other politicians, including Education Minister Naser al-Deen al-Shaer, to be released from custody."

Shalit was captured a year ago by Palestinians in Gaza. Goldwasser and Regev were seized by Lebanese Hezbollah guerrillas shortly after Shalit was abuducted, sparking a month-long war. Johnston is a BBC correspondent missing in Gaza for nearly three months.

Israel detained more than 30 Palestinian legislators last year, mostly from Hamas, after the militant group won an election. In the past week it has seized Shaer and another Hamas minister along with more than 30 other Palestinian officials.

Poettering also called for Israel to release some $700 million of Palestinian customs revenue it has collected but not passed on to the Hamas-led Palestinian government in an attempt to topple it. Israel, the European Union, United States and others have imposed sanctions on Hamas for refusing to renounce violence against Israel.

"The Palestinians need this money to pay the salaries of the teachers and to pay the salaries of the policemen," he told Reuters before his speech in parliament. "This is Palestinian money ... This is not money which belongs to others."

The cash should go to Palestinian Authority Chairman Mahmoud Abbas, from Hamas' rival Fatah movement, Poettering added. He met with Abbas in Gaza and later with Israel's Foreign Minister Tzipi Livni during a visit of several days. He did not meet Hamas officials, he said, calling Abbas the "highest representative" of Palestinians.

"It's Abbas who counts," he said.