June 17 (Bloomberg) -- President George W. Bush said ``numerous contacts'' between Iraq and the al-Qaeda terrorist network justified the U.S.-led war on Saddam Hussein's regime.

``There was a relationship between Iraq and Saddam and al- Qaeda,'' Bush told reporters after meeting with his Cabinet at the White House. ``This administration never said that the 9/11 attacks were orchestrated between Saddam and al-Qaeda. We did say there were numerous contacts between Saddam and al-Qaeda.''

A panel investigating the Sept. 11, 2001, attacks reported yesterday that meetings or contacts between the former Iraqi dictator and al-Qaeda terrorist leader Osama bin Laden didn't lead to a collaborative relationship. There's ``no credible evidence that Iraq and al-Qaeda cooperated on attacks against the United States,'' the panel said.

``Saddam Hussein was a threat,'' Bush said when asked about the report. ``He was a threat because he had used weapons of mass destruction against his own people. He was a threat because he was a sworn enemy of the United States of America, just like al- Qaeda. He was a threat because he had terrorist connections.''

``The world is better off and America is more secure without Saddam Hussein in power,'' the president said.

Continuing Violence

The U.S.-led coalition is preparing to transfer power to a caretaker Iraqi government on June 30. Bush yesterday predicted violence would increase as the handoff draws near.

At least 833 U.S. soldiers have been killed since the war began in March 2003, with 693 deaths since May 1 of that year, when Bush declared major hostilities over, Pentagon figures show.

The violence continued today. At least 41 people were killed and 142 injured when car bombs exploded near an Iraqi army recruitment center in Baghdad and outside a government building in Yethrib, north of the capital, U.S. and Iraqi officials said.

The Iraq war, with its mounting casualties, increased bombings and prison abuse, is hurting Bush in public opinion polls. A Los Angeles Times poll June 5-8 found 53 percent of those surveyed said going to war wasn't worth the cost, while 43 percent said it was. The poll surveyed 1,230 registered voters.

In polls taken in November and March, a majority of those asked said the war was worth the cost, the Times said.

Kerry's Reaction

Democratic presidential candidate John Kerry, a four-term U.S. senator from Massachusetts, said the report by the Sept. 11 commission, a 10-member bipartisan panel, challenges Bush's justification for war and suggests the president misled the nation.

``This president failed the test in Iraq,'' Kerry, 60, said while campaigning in Ohio yesterday. ``When it comes to war and peace, I will tell the truth to the American people.''

In Congress, House Democratic Leader Nancy Pelosi of California urged Bush to ``clear the air'' about his motivations for going to war with Iraq.

``The president has a responsibility to the American people to speak the truth on this subject,'' Pelosi said.

The commission is holding its final public hearing today in Washington. After 18 months of work, the panel plans to deliver its final report to Congress and the White House by July 26, the opening day of the Democratic National Convention in Boston.

To contact the reporter on this story: Roger Runningen in Washington rrunningen@bloomberg.net