The Secretary of State for Northern Ireland signalled that she would not expel Sinn Fein from the peace process, in spite of renewed calls yesterday by Ulster Unionists for the Republican leaders to be thrown out of the talks.
Ms Mowlam, who met security chiefs earlier this week to review the ceasefire, has to decide whether IRA links with the smuggling of weapons to Ireland from the United States, and the killing of a suspected police informer, Charles Bennett, do amount a breach of the two-year-old IRA ceasefire.
"She explained the consequence of her finding a breach of the ceasefire would be an effect on the prisoner release programme," said a spokeswoman for the Northern Ireland Office (NIO).
Angry Ulster Unionists stepped up pressure to expel Sinn Fein as Ms Mowlam met a Sinn Fein delegation at Stormont. Senior members of David Trimble's official Ulster Unionist Party warned paramilitary attacks were draining the political process of credibility. The UUP leaders are expected to meet next week to decide if the party should meet Sinn Fein leaders again before the review of the Good Friday Agreement begins.
A senior Ulster Unionist, Fred Cobain, said: "This issue cannot be fudged any longer. If she is being told by the security advisers that the IRA is in breach of the ceasefire, then nothing short of the exclusion of Sinn Fein from the executive will suffice." But the NIO said there was "no automatic process" for excluding Sinn Fein from a review of the peace accord by the American mediator, the former senator George Mitchell, next month.