A Holocaust survivors group on Friday issued an ultimatum to Prime Minister Ehud Olmert, vowing it would go ahead with plans to hold a protest on Sunday unless he officially retracts a controversially low new stipend for survivors.

The Foundation for the Benefit of Holocaust Victims in Israel announced the "march of the living" will go ahead as planned unless Olmert publically annuls what they believe to be an insufficient NIS 83 shekels monthly allowance.

In addition, the group, which is supported by the Tafnit party headed by Israel Defense Forces Major General (res.) Uzi Dayan, demanded the prime minister immediately invite their representatives to talks.

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An umbrella group for a number of Holocaust survivors' organizations, however, said the decision does not represent their stance.

The Center of Organizations of Holocaust Survivors in Israel said it was reassured by Pensioners' Party Chairman Rafi Eitan that Olmert will withdraw the stipend and reach an agreement over a larger allowance.

While the group did express a clear position regarding Sunday's march, members privately admitted that they prefer to concentrate on deliberation rather than protests.

Eitan, who is minister of Pensioners Affairs, told Israel Radio he thought allowances should be allocated to survivors according to their financial situation instead of awarding a uniform sum to all.

On Thursday, government officials and representatives of Holocaust survivors' groups announced they will start talks to reach a new increase in allowances.

Participants of the meeting said that it was clear, if not declared, to the sides that the original amount offered by the government was off the agenda, and a new solution would be negotiated based on recommendations made by an interministerial committee, headed by Itzkovich, which had recommended an allowance of NIS 1,040 per month.

The allowance would have allocated NIS 83 (about $20) for survivors over the age of 70 living in Israel in 2008. The amount, which was to increase incrementally by 2011, was met with disbelief and uproar by survivors, who said they would refuse to accept it unless it was increased.

The sides agreed to enter into expedited negotiations to find a joint and comprehensive solution to the plight of survivors, many of whom live in poverty.

It is unclear whether a march planned by the survivors for Sunday will go ahead.

The meeting lasted some two hours at the Prime Minister's Office in Tel Aviv, and was attended by Eitan; director general of the PMO, Ra'anan Dinor; director general of the Welfare Ministry, Nahum Itzkovich and members of the umbrella organization of Holocaust survivors, headed by Noah Plug.

The meeting, initiated and organized by Eitan, was defined as "preparation" for negotiations and a meeting set to take place between survivors and Prime Minister Olmert next week.

"It was clear to everyone present in the room that we were heading toward a serious and comprehensive solution," one of the survivor representatives said, continuing, "We saw, this time, that there was real openness."

The joint statement said that the sides "left with the feeling that after decades of disappointment, they are getting honest and real treatment by the government, which is willing to find a profound solution to the plight of the survivors."

"We are all rolling up our sleeves and getting ready for joint work so that the upcoming discussion with the prime minister will be serious and work for the benefit of Holocaust survivors," said Plug after the meeting.

The official joint statement did not mention the march announced by the survivors on Wednesday, and the representatives of the survivor groups refused to answer questions on whether they would still support it.

While Holocaust survivor groups are careful to maintain an outwards display of unity, tensions between organizations are growing underneath the surface.

Some survivors have already said they would take part in the protest wearing concentration camp uniforms and a yellow badge Jews were required by Nazi Germany to sew on their clothes to differentiate them from non-Jews.