Britain abruptly canceled a high-level meeting with officials of the Palestine Liberation Organization today, charging that the PLO representatives had reneged on pledges that they would join in a statement during their visit here renouncing violence and explicitly recognizing Israel's right to exist.
The last-minute cancellation of scheduled talks between Foreign Secretary Geoffrey Howe and two members of the 15-man PLO Executive Committee appeared to have ended, at least temporarily, Britain's month-long Middle East initiative and may have dealt a lethal blow to the peace efforts of Jordan's King Hussein.
The two Palestinians, deposed West Bank mayor Mohammed Milhem and Anglican Bishop Elias Khoury, were staying at an undisclosed location here tonight under heavy security and made no public comment.
This afternoon, the PLO office in London charged that the British had made unacceptable last-minute changes in the agreed-upon statement. This evening, however, the same PLO spokesmen said that all previous comment was "inoperative" and that an official response would be issued following an emergency executive committee meeting being held at the organization's headquarters outside Tunis.
British officials denied that there had been any changes in the statement, which they said Jordan, acting for the Palestinians, had agreed to last week. They placed all responsibility for the failure of the meeting to take place on the Palestinians.
However, they acknowledged that "events of recent weeks," including last week's hijacking of an Italian cruise ship, allegedly with PLO involvement, "produced an atmosphere which made it very difficult to go ahead."
The meeting, which was arranged by Hussein and Prime Minister Margaret Thatcher during her visit to Jordan last month, was to include Jordanian Foreign Minister Taher Masri and Deputy Prime Minister Abdul Wahab Majali as part of a Palestinian-Jordanian delegation.
British officials said the first indication that it might not go ahead came during a preliminary session late yesterday in which the Palestinians objected to the statement. The Jordanians, one official said, "were as surprised as we were."
After further consultation overnight between the Palestinians and Jordanians, the official said, Britain was informed at 9 a.m. today that the statement could not be issued, and Howe met with only the two Jordanians.
Howe said that he was "deeply disappointed" that the Palestinians "were not after all willing to associate themselves with the statement agreed with the Jordanian members of the delegation, which contained explicit references both to Israel's right to exist within secure and recognized borders and to the right of the Palestinians to self-determination."
According to officials here, it was the mention of Israel, rather than the renunciation of violence, that was deemed unacceptable. It would have marked an advance over United Nations resolutions that mention the rights of states in the region generally rather than specifically.
The statement was the condition Thatcher had set for the meeting. British officials said its wording was negotiated in Amman during the last three weeks between Jordanian Prime Minister Zaid Rifai and the British ambassador and concluded last Thursday. Although Britain did not meet directly with the PLO, "we had no reason to think that the Jordanians couldn't deliver the Palestinians."
In a statement issued tonight in Amman, Jordan said one of the two Palestinian members of the delegation "was unwilling to approve the text of the statement as agreed." It did not say which one.
The original decision to meet with the two was a sharp departure for Britain, which does not officially recognize the PLO, although British officials have fairly regular low-level contacts with the organization.
Milhem and Khoury, both recently appointed to the PLO committee, were chosen carefully for the meeting because they were considered "men of peace," officials here said. In a Sept. 20 news conference announcing her initiative in Aqaba, Jordan, Thatcher said "they are men who are known to reject violence, and they've made that very, very clear."
Thatcher repeatedly described the meeting as a "risk," and it brought sharp criticism from Israel, its supporters within her own Conservative Party, and leaders of Britain's 400,000-strong Jewish community. But she defended it as necessary to break the logjam that has held up progress in an initiative announced by Hussein last year to end the Israeli occupation of the West Bank and Gaza and bring peace to the region.
After lengthy negotiations in February, Arafat agreed with Hussein to work toward a "confederated state of Palestine" through an international conference. Arafat agreed that Jordanian officials in Amman could negotiate on behalf of the Palestinians, along with a token PLO delegation.
The proposal has foundered under criticism from fundamentalist Arab states, U.S. reluctance to hold initial meetings with a delegation including PLO representatives and Israeli insistence that it will talk only to Jordan without the Palestinians.
Thatcher has been eager to solidify relations with moderate Arab states such as Jordan and Saudi Arabia, which provide a major market for British military exports. At the same time, while maintaining that Britain has no central role to play in Middle East negotiations, she believes that the close British relationship with both the United States and Jordan put it in a useful and unique position to provide new impetus to Hussein's plan.
Although the Reagan administration had made little public comment on the meeting, officials here said that during recent meetings with Howe at the United Nations, Secretary of State George P. Shultz had "welcomed" it. "They were initially cool, but they warmed up as time went by," an official here said.
Israel, which had criticized the meeting and said that Thatcher was being "deceived" by thinking that Milhem and Khoury were moderate Palestinians, today applauded its cancellation.
"We want direct negotiations about peace with other countries and with Palestinian Arabs," Israeli Foreign Minister Yitzhak Shamir said in a television interview here tonight. But "we will never negotiate with terrorists."