An Israeli government official confirmed Tuesday that Israel has been working with Washington and members of the international peace-making Quartet to draw up a new framework that could relaunch stalled talks.

The package of principles aims to draw Palestinians back to the negotiating table and head off their plan to seek United Nations membership for a Palestinian state on the lines that existed before the 1967 Six-Day War.

But the Palestinians were unimpressed, with negotiator Saeb Erakat calling on Israeli Prime Minister Benjamin Netanyahu to "announce his position in front of the world and the international media."

Netanyahu should announce "that the 1967 borders are the basis for negotiations and a halt to all building of settlements on Palestinian land, including east Jerusalem," he told AFP, denouncing the reports as a PR exercise.

The framework negotiations were first reported by Israeli media on Monday night.

"Over the last few weeks there has been an ongoing attempt to restart the peace process to allow for the resumption of direct talks between Israel and the Palestinians," the government official told AFP.

"The assumption is that if this process succeeds, the Palestinians will withdraw their proposal for unilateral action at the UN."

The framework being discussed is based on a speech made by US President Barack Obama to the pro-Israel lobby group AIPAC earlier this year.

In that address, Obama called for the negotiations that would create borders for "Israel and Palestine... based on the 1967 lines with mutually agreed swaps."

He said Israel was not being asked to return to the lines that existed before the 1967 war, when Israel captured the West Bank, Gaza and east Jerusalem, and that a final deal would take account of "new demographic realities," a reference to Israel's settlements.

"The ultimate goal is two states for two people: Israel as a Jewish state and the homeland for the Jewish people and the state of Palestine as the homeland for the Palestinian people," he said.

"That is the sort of language that we can live with," the Israeli official said, adding that the tentative framework "contains other elements that from our point of view are very positive."

"The formulation is something like: the goal for the talks is two states for two people and recognising Israel as Jewish state," he said.

The details described on Tuesday mirrored comments made by Netanyahu at a closed-door meeting of the Foreign Affairs and Defence Committee on Monday, the Jerusalem Post reported.

"We are interacting with the US to put together a document using language from Obama's second speech" to AIPAC, the Post quoted him as saying.

He said the framework would ensure Israel's recognition as a Jewish state, exclude the Palestinian Islamist movement Hamas which rules Gaza from any talks and assure the final borders would not be the same as those that existed before the Six-Day War.

Talks between Israel and the Palestinians have been on hold since last September, grinding to a halt shortly after their relaunch earlier the same month over the issue of settlement construction.

Israel has declined to renew a partial settlement freeze that expired shortly after the direct talks began, and the Palestinians have said they will not negotiate while Israel builds on occupied land they want for a future state.

With talks on ice, they have instead pushed forward with a plan to seek UN membership for a Palestinian state this September.

Palestinian president Mahmud Abbas has insisted the plan does not rule out the possibility of new peace talks, but said he will not negotiate without a settlement freeze and a clear set of parameters for any new talks.