The Morrison government has been advised by key bureaucrats and retired "wise elders" against moving its Israel embassy to Jerusalem or making other significant changes to Australia’s stance on the status of the city central to the Middle East peace process.

In a development that puts the government in the awkward position of potentially having to ignore its own key advisers, the clear majority view the government has received from its most senior and seasoned foreign policy thinkers is to keep things as they are, The Sydney Morning Herald and The Age understand.

Prime Minister Scott Morrison and Minister for Foreign Affairs Marise Payne address the media during a press conference on Australia's embassy in Israel, at Parliament House in Canberra. Credit:Alex Ellinghausen

The Morrison cabinet is wrestling with whether to make the historic shift in its foreign policy, having discussed the matter this week and with the clock ticking on making a promised announcement before Christmas.

It follows Prime Minister Scott Morrison’s declaration in the heat of the Wentworth byelection campaign that the government would consider recognising Jerusalem as Israel’s capital and moving Australia’s embassy there.