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Prime Minister Ehud Olmert said Monday that Israel would "respond severely" to the ongoing Qassam rocket fire from the Gaza Strip, saying the fire "threatens civilian lives in the northern Negev," according to a statement released by the Prime Minister's Office.

"The Qassam attacks constitute a tangible threat to Israel," said Olmert, during a meeting with German Foreign Minister Frank-Walter Steinmeier. "Israel cannot show restraint forever."

The Israel Air Force fired on a Qassam-firing squad in northern Gaza on Monday, wounding one militant, hours after a Qassam rocket hit a house in the center of Sderot. On Sunday, two people were wounded, one moderately, when a rocket hit a gas station near the western Negev town.

Meanwhile, UN Secretary General Ban Ki-moon reiterated a call for the PA "to take all actions needed to halt immediately the firing of rockets against Israeli population centers, which by definition target civilians."

Foreign Minister Tzipi Livni however cautioned Monday against a hasty decision to invade Gaza over the continued rocket strikes, saying the government must not repeat mistakes of the Second Lebanon War.

Livni requested that the military echelons present its plans, as well as a number of alternative options, and that the Foreign Ministry be involved in any decision on how to proceed.

"I think that the time has come to change the way of working, both in the government and in the relationship between the military and diplomatic echelons," she told a joint press conference Monday following a meeting with Steinmeier.

"As a member of the cabinet, I expect that there will be a debate during which the military echelon will present its plans," she said.

"The situation in Gaza is complicated, and the government must hold a comprehensive and considered decision-making session."

The foreign minister also touched on the partial report released last week by the Winograd Committee, saying that in light of the panel's findings, she expects a change in the decision-making processes.

"These decisions are only apparently security related. The Foreign Ministry must be party to them," she said. "I expect to be given alternatives and discuss [them] in depth so that a decision can be made on the matter."

Steinmeier met separately with Livni and Prime Minister Ehud Olmert in Jerusalem on Monday to discuss the peace process and the Winograd report.

The German foreign minister, whose government currently holds the presidency of the European Union, invited Livni to discuss the Middle East peace process at an upcoming meeting of EU foreign ministers.

"I told Tzipi today that I'd like the Israeli foreign minister to seize the opportunity, to present her views to the European foreign ministers one more time," he said.

The Palestinian foreign minister, Ziad Abu Amr, is scheduled to address the next meeting of foreign ministers. Livni would attend the following session, Steinmeier said.