Israeli Defence Minister Ehud Barak has announced last-minute changes to the part of the security barrier that runs near to the contested E1 corridor, where Israel plans to build thousands of new settlement homes.

The defence minister intends to close the gap in the separation fence between Jerusalem and Ma'aleh Adumim, which would cut off the E1 area from the Palestinians, according to Haaretz.

Mr Barak said original plans were too expensive and these new changes are motivated by financial considerations.

Under the new arrangements, the residents of Arab village Al-Zaim would be surrounded by two separation fences and a military checkpoint.

The plan will be sent to Israeli Prime Minister Benjamin Netanyahu for approval next week.