JERUSALEM (AFP) – Defence Minister Ehud Barak said on Monday he was leaving his struggling Labour party and setting up a new centrist party called "Independence," in a move set to strengthen the Israeli government.

The surprise decision will see Barak and four other deputies leaving the strife-torn faction as the result of a "shift to the left" within the party which he has led since 2007.

But with Barak's new party set to remain in government, the move looked likely to stabilise and even strengthen the largely rightwing coalition of Prime Minister Benjamin Netanyahu.

"We have presented a request to the Knesset to recognise us as a new faction that will be called 'Independence' ... which will be centrist, Zionist and democratic," Barak said at a news conference broadcast live on Israeli radio.

Shortly afterwards, the split in the Labour party was approved by the parliament's House Committee, with 11 in favour, three against and one abstention.

Barak's announcement was widely seen as coordinated in advance with Netanyahu in a move which would most likely "strengthen" the premier, army radio said, pointing out he can now count on a "stable majority" of 66 MPs in his 120-member coalition.

In return, Netanyahu had agreed to allow Barak and the other two senior party members to continue holding their ministerial posts, army radio said.

"The State of Israel is facing tests which are not simple, at the centre of which is the political process with the Palestinians and within the region, security tests and complex challenges regarding the economy and society," Barak said.

"We are ready to face them."

Israeli commentators said the decision was a tactical move by Barak aimed at protecting his position as defence minister and remaining in the ruling coalition following increasing pressure from Labour deputies to quit over the impasse in peace talks with the Palestinians.

Until now, Labour has been the third-largest party in Netanyahu's ruling coalition, with 13 seats in the 120-member Knesset.

Barak took four others with him -- Agriculture Minister Shalom Simchon, Deputy Defence Minister Matan Vilnai and MPs Einat Wilf and Orit Noked.

Shortly afterwards, Isaac Herzog, who holds the social affairs portfolio, became the first Labour minister to quit the government, while stressing he would stay with the party.

"It is a personal resignation but I have talked about it with my friends, the ministers Benjamin Ben Eliezer and Avishay Braverman ... They understand the reality very well and want, with me and others, to save the Labour party," he said.

Braverman, who holds the minority affairs portfolio, also told reporters he would resign but would stay with the ailing Labour party.

"A government which has decided not to advance the peace process is a government in which I have no place, therefore at the end of this news conference I shall submit my resignation to the prime minister," he said in comments broadcast live on radio stations.

Trade and Industry Minister Ben-Eliezer, a political heavyweight within the party which now counts just eight MPs down from 13, was expected to outline his position later in the afternoon.

There have been sharp divisions within the party in recent months over Labour's role in the ruling coalition which has failed in its efforts to further peace talks with the Palestinians.

Explaining his reasons for abandoning the party, Barak pointed to a "a shift towards the left" as well as the "endless infighting" which had left the party weak and divided.

In a letter sent to the party, Vilnai spelled out his reasons for leaving.

"The Labour faction in the Knesset has become an unbearable place where parliamentary life is impossible. Each meeting you didn't know who was with you and who was about to quit and join another party," he wrote.

Netanyahu had on Sunday accused Labour of being responsible for the deadlock in peace talks, saying its threat to quit the coalition was the main factor preventing the Palestinians from returning to the table, Haaretz daily said.

During the 2009 elections, Labour, which has long dominated Israeli politics, limped home in fourth place behind the opposition Kadima party, Netanyahu's Likud and the ultra-nationalist Yisrael Beitenu of Foreign Minister Avigdor Lieberman.