British Prime Minister Tony Blair has acknowledged the deep divisions the Iraq war has caused, in what could be his last major speech to his ruling Labor Party before elections expected next year.

In a speech twice interrupted by anti-war hecklers, Mr. Blair laid out his case for why voters should give the Labor Party an unprecedented third consecutive term to rule Britain.

Mr. Blair spent most of his time on domestic policy, but it was on the divisive issue of Iraq that the speech reached its emotional climax.

With public opinion polls reflecting deep distrust of the prime minister over his handling of Iraq, Mr. Blair told the delegates he wanted to deal with the issue head-on.

"The evidence about Saddam [Hussein] having actual biological and chemical weapons, as opposed to the capability to develop them, has turned out to be wrong," he said. "I acknowledge that. I accept it. The problem is that I can apologize for the information that turned out to be wrong, but I cannot, sincerely at least, apologize for removing Saddam."

Mr. Blair said that in his judgment, the rise in Islamic terrorism is not limited to a few extremists, but is deeply rooted, widespread and a "perversion of Islamic teachings" that must be destroyed.

"In the madrassas [Islamic schools] of Pakistan, in the extreme forms of Wahabi doctrine in Saudi Arabia, in the training camps of al-Qaida in Afghanistan, in the cauldron of Chechnya, in parts of the politics in most countries in the Middle East and many in Asia, in the extremist minority that now in every European city, [they] preach hatred of us and our way of life," the prime minister said. "The only path to take is to confront this terrorism, remove it root and branch, and at all costs prevent them from acquiring the weapons to kill on a massive scale because these terrorists will use them."

Mr. Blair also said he will make it a personal priority to renew the Middle East peace process after the U.S. presidential election in November. He said a Palestinian state and Israel living peacefully side-by-side would do more to end terrorism than bullets will ever do.