"11. Resolves that the refugees wishing to return to their homes and live at peace with their neighbours should be permitted to do so at the earliest practicable date, and that compensation should be paid for the property of those choosing not to return and for loss of or damage to property which, under principles of international law or in equity, should be made good by the Governments or authorities responsible."

A point to note is that the resolution does not grant a "right" for refugees to return, but instead expresses that they "should" be permitted return.  Furthermore, this is contingent upon an ability to live at peace with neighbors, but the violence in Israel over the past seven years calls that into serious question.  The second point of note is that this was a General Assembly Resolution, and these resolutions are non-binding.

The PA is the governing body of the Palestinian people. It was established in 1993 as part of the Oslo Accords, which granted the Palestinians self-government in the disputed territories of Judea and Samaria/West Bank and Gaza. In exchange for self-rule, the Palestinian Liberation Organization (PLO)--an umbrella organization of political and military groups that was the forerunner of the PA--agreed to recognize Israel's right to exist within secure borders. PLO officials, however, have never amended the PLO charter, which continues to call for Israel's destruction.

From the Israeli Ministry of Defense:
The Security Fence is an operational concept conceived…to reduce the number of terrorist attacks whether in the form of explosive- rigged vehicles or in the form of suicide bombers who enter into Israel with the intention of murdering innocent [people].

From the Israel Ministry of Foreign Affairs:
The matrix of civilian bonds and ties- economic, educational, medical etc, between Palestinian villages and cities has been thoroughly examined as well as the way they were affected by the construction of the Security Fence. Only 3.8% of the security fence is walled.

According to statistics provided by the Israel Security Agency, since the August 2003 completion of the first section of the security fence and buffer zone, there has been a drastic reduction in the number of mass-murder attacks carried out in Israel: Between…September 2000 and the erection of the security fence in August 2003, they carried out 73 attacks, killing 293 Israelis and wounding 1,950. Between August 2003, with the erection of the security fence, and the end of 2006, the terrorist organizations operating from Samaria carried out 12 attacks, killing 64 Israelis and wounding 445.

From The Jewish Virtual Library:
Following Ariel Sharon's decision to leave the Likud Party in November 2005, Olmert joined with Sharon and several other former Likud ministers to form the new centrist party, Kadima. On January 4, 2006, Sharon suffered a massive stroke that left him unable to perform his dutires as prime minister. On January 5, Olmert was given acting prime ministerial duties to keep the government running effectively in Sharon's absence…Olmert remained acting Prime Minister until the Israeli elections, which took place on March 28, 2006.  Following elections… Ehud Olmert became Prime Minister of the 31st Government of Israel.