The government will risk a republican backlash by suspending Northern Ireland's power- sharing executive by the end of the week if the IRA refuses to give a firm commitment on decommissioning weapons.
Amid fears that the peace process is on the brink of collapse, Peter Mandelson, the Northern Ireland secretary, will launch a last-ditch attempt to broker a deal on arms during an intensive round of talks with political leaders over the next two days (February 2-3).
His chances of success, however, appeared to be slim last night when David Trimble, Northern Ireland's first minister, said he could no longer remain in the power-sharing executive after John de Chastelain reported that the IRA was still refusing to disarm.
His warning was immediately rejected by Gerry Adams who spoke of a "real crisis" in the peace process.
Mr Mandelson tried to strike an upbeat note last night when he insisted that there were several "positive" elements in the de Chastelain report, which was passed to the British and Irish governments shortly before midnight on Monday.
Ministers also took heart from an IRA statement which said that it remained "totally committed to the peace process", adding that it had no plans to abandon its ceasefire. The "IRA's guns are silent", the provisionals added.
It is understood, however, that the de Chastelain report falls a long way short of Mr Trimble's demands for the IRA to begin disarming this month.
Mr Trimble insisted yesterday that the power-sharing executive be suspended immediately. He claimed republicans had reneged on a commitment to begin disarming. Sinn Fein insisted that republicans merely gave a commitment in last year's review of the peace process to hold discussions with Gen de Chastelain in line with the Good Friday agreement.
The general yesterday warned the British and Irish governments of the dangers of suspending the executive. It is understood that he told ministers the IRA would boycott his commission - ending any hopes of decommissioning - if the executive were suspended.
Bertie Ahern, the Irish prime minister, reinforced the message yesterday when he warned of "disastrous consequences" if the executive were suspended. However, the British government is expected to take the risk of suspending the executive by the end of the week if the IRA still refuses to begin the process of disarming. It is thought that republicans are unlikely to make enough concessions to prevent such a drastic course. Suspending the executive will be seen as the "least bad option".
Ministers will risk a republican boycott of Gen de Chastelain's commission and a severe backlash from Sinn Fein whose leaders bitterly attacked Mr Trimble yesterday for attempting to impose a decommissioning deadline outside the agreement.
If ministers fail to suspend the executive Mr Trimble would resign over the weekend, taking his party's three other ministers with him. The assembly's complicated voting procedure mean that Mr Trimble would never again be reinstated as first minister, even if there were an agreement on decommissioning.
After suspending the executive, the government would probably announce a review to try to break the five-year deadlock over arms. But with the executive out of action any gesture by the IRA would be highly unlikely.