Tony Blair, the Prime Minster, tried to play down the news but his efforts were not matched by others involved in the peace process.
Mr Blair, breaking off from the two-day summit of European Union member states in Vienna, said: "I wouldn't lay too much stress on one particular report.
"I don't pretend to know the inner workings of the IRA, that's up to them. What I know is the agreement must be implemented.
"My view is very clear, the agreement that we negotiated in all its terms has to be implemented and has to be implemented by everybody.
The Prime Minister insisted: "People don't want to be in government of Northern Ireland with people who, if you like, talk the language of democracy on one hand, but have guns and bullets on the other."
Bertie Ahern, the Irish Prime Minister, was disappointed with the news and said: "I never respond to IRA statements. I believe that there should be decommissioning, that it should be under the terms of the agreement and it should be as soon as possible."
But Ken Maginnis, the Ulster Unionist Party's spokesman on security, said he was "not surprised" at the IRA decision.
He said: "The ability of the leadership of Sinn Fein/IRA to take the entire movement with it has seemed to be less and less over the last few months.
"If action had been taken to pressure the movement immediately after the signing of the Good Friday Agreement and the referendums, north and south, there might have been some possibility of progress," he said.
The Rev Ian Paisley, the leader of the Democratic Unionist Party, said: "This absolutely confirms what I have always been saying, that under the constitution of the IRA the only time they will hand in any arms is when there is a united Ireland, and they will hand them into the government of the united Ireland.
"It is quite clear there will be no decommissioning."
And he said that the gunmen would continue "to get into the government of Northern Ireland".
Andrew Mackay, the Conservatives' spokesman on Northern Ireland, said: "We now see clearly that Sinn Fein/IRA are reneging on their part of the Belfast agreement.
"Perhaps Tony Blair will now respond positively to our demands that he draws a line in the sand and says `no more early release of terrorist prisoners' until there is substantial and verifiable decommissioning of illegally held arms and explosives."