The Prime Minister flew to New York this week "to fight for Israel" at the United Nations, according to senior Conservative Party sources.

The UK government has been careful during an intense period of diplomatic brinksmanship not to show its hand on whether it would support the recognition of Palestinian statehood. But the JC understands that David Cameron's intention has been to keep the Palestinian bid out of the Security Council and to reach a deal that falls short of recognition.

The Conservative sources were keen to emphasise that the coalition government had done right by Israel in its reform of the law of "universal jurisdiction", allowing Israeli politicians and military figures to visit the UK without fear of arrest for alleged war crimes.

Mr Cameron also personally intervened to pull the UK out of the UN conference to mark the anniversary of the Durban declaration (Durban III), which singled out Israel as being guilty of human rights abuses.

It is understood that the Prime Minister is particularly concerned that recognition might mean that Palestine could apply to have Israelis tried at the International Criminal Court, and that this represented a red line for the UK.

At the same time, the Labour Party under Ed Miliband gave the strongest indication yet that it was distancing itself from the Blair-Brown era of close support for Israel, when it told the UK government on Tuesday that it "should be willing to support the recognition of Palestinian statehood".

In a letter to Foreign Secretary William Hague, Labour's foreign affairs spokesman Douglas Alexander wrote: "There is a wide consensus around a two-state solution that has been embraced by the majority of Israelis and by the present Israeli government.

"Recognition at the United Nations for the Palestinians is one of the steps required to achieve this."

The surprise move prompted an immediate response from Mr Hague. "The UK has deliberately reserved its position on the question of recognition of Palestinian statehood while we continue to urge all parties back to talks in the absence of an actual proposition before the UN," he said.

"Witholding our position in this way, along with other European partners, maintains the pressure on both sides to show the flexibility needed to enable a return to negotiations."

The Jewish Leadership Council and the Board of Deputies wrote to Mr Alexander expressing "profound concern and disappointment". In a letter to Mr Cameron they urged the government to oppose moves for a unilateral declaration.of Palestinian statehood.

Meanwhile, the Liberal Democrats succeeded in keeping a lid on dissent over the Palestinian bid for statehood at their party conference this week. Although former leader Sir Menzies Campbell spoke at a fringe meeting urging the government to vote in favour of the bid, the issue was carefully managed on the conference floor. After speculation over a coalition split on the issue, Deputy Prime Minister Nick Clegg went on went on BBC News to explain that there had been debates at the highest level of government and that Britain faced a "difficult judgment". On the discussions he added: "The senior members of the government on an issue like this – the Foreign Secretary, the Prime Minister and myself – we talk about this a lot. But we do it as a government . I do not think it helps at all on issues like that for there to be a running commentary on who says what." He warned of the danger of isolating moderates in the Palestinian community if the bid was rejected while recognising that Israel was "very, very hostile" to the idea.

In the international debate on the conference floor a pro-Palestinian amendment was voted through, but it did not prove embarrassing to the leadership. Although it referred to "negotiation between Israel and the freely elected representatives of the Palestinian people", which could be taken to mean the Hamas government in Gaza as well as the Palestinian Authority, there was no reference to a boycott of Israel.