PLO official Saeb Erekat on Thursday dismissed reports that the Palestinian Authority offered to stop trying to join UN agencies if Israel lifted its block on tax transfers.

The Israeli daily Haaretz reported Thursday that the PA offered to stop trying to join international agencies and pledged not to seek any upgrade to its UN status if Israel released money it owes the PA.

Israel has refused to transfer tax revenues owed to the PA -- amounting to around $100 million each month -- since UNESCO, the UN cultural agency, voted to admit Palestine.

Erekat told Ma'an the reported deal was "nonsense" and insisted the PLO would continue to seek full membership of the United Nations.

"This is nonsense and we are determined to apply for membership. We should stop dealing with Israeli propaganda."

PLO Executive Committee member Hanan Ashrawi also rubbished the report.

"This report is completely untrue, and the Israeli media tools are not the source of information for the Palestinian positions and decisions," she said in a statement.

"The report is a new Israeli maneuver and an attempt to create confusion to stop the Palestinian bid to the UN."

Both Erekat and Ashrawi said the PLO was determined to pursue Palestine's bid for full membership of the UN.

"The Palestinian government is still focusing on getting support from the Security Council," Erekat said.

The US has vowed to veto Palestinian membership of the UN at the Security Council.

Haaretz reported that the PA agreed not to seek observer state membership if the bid for full membership failed, quoting a European diplomat.

According to the report, Israeli Prime Minister Benjamin Netanyahu's special envoy Issac Molho met secretly with US representatives in London to discuss the offer.