A senior Israeli defense official has effectively been suspended from his role as the main negotiator with the Egyptians over the release of a kidnapped Israeli soldier and the ceasefire with Hamas after criticizing Prime Minister Ehud Olmert in an interview, local daily The Jerusalem Post reported on Monday on its website.

The effective suspension of Amos Gilad, head of Israeli Defense Ministry's political-security bureau, came as the Prime Minister's Office (PMO) filed a disciplinary complaint with the Civil Services Commission against Gilad, said the report.

Director-General of the PMO Ra'anan Dinur, who filed the complaint, wrote that the remarks published in local daily Ma'arivlast Wednesday constitute inappropriate criticism by a senior government official against an incumbent prime minister and his office.

The letter of complaint, which was also sent to Israeli Defense Minister Ehud Barak, stated that "Gilad's statements as expressed in the letter are particularly serious, and seem to harm Israel's foreign relations and the prime minister's status."

"In light of this, I ask you to immediately order a disciplinary investigation against Amos Gilad, and, inasmuch as disciplinary infractions are found, to take binding measures," it said.

However, Israeli Defense Ministry released a statement Monday morning, saying that Gilad would continue to liaise with international officials, including the Egyptians, on behalf of the ministry.

The statement went on to say that the prime minister's decision "not to be assisted by Gilad's abilities and experience" was "his right," but said the main party hurt by the move would be the Jewish state.

The PMO had not named a replacement for Gilad, but Israeli defense officials said Monday that veteran negotiator Ofer Dekel was dealing with efforts to free Gilad Shalit, who has been in Palestinian captivity since he was abducted in a cross-border raidby Hamas-allied militants in June 2006.

On the eve of a critical discussion in Israeli security cabinet last Wednesday, where it was decided to link opening the Gaza border crossings to the release of Shalit, Gilad was quoted by Ma'ariv as saying "I don't understand what they are trying to do."

"Insult the Egyptians? We've already done that. This is insanity, simply insanity. Egypt remains almost our last ally here. For what? We are harming national security," said the senior defense official.

Gilad was responding to criticism directed at him from the PMO, to the effect that he acted independently with the Egyptians and was dragging Olmert into a ceasefire agreement with Hamas that Olmert didn't want.

Gilad sharply refuted the allegations, saying that everything he did was recorded and sent on to Olmert.

"I was briefed before every trip I took, and briefed the defense minister and prime minister when I returned, usually at same night," he told Ma'ariv.