The Prime Minister is reported to be working on proposals to establish a power-sharing assembly in Northern Ireland.

The plan, which is not yet finalised, would limit the powers of North-South cross-border institutions, and have alongside the assembly a "council of the isles".

The council would draw members from the assembly, from assemblies in Scotland and Wales and ministers from London and Dublin, according to The Daily Telegraph newspaper.

It has already been discussed with David Trimble, the Ulster Unionist party leader, and Downing Street is said to be seeking the support of Dublin and the main Nationalist party in Northern Ireland, John Hume's SDLP.

Unionists could be prepared to accept such an arrangement as it would limit the powers of cross-border bodies.

One of their main arguments against the Framework Document which led to the current political process is the proposal for powerful cross-border bodies which they see as giving Dublin too great a say in the affairs of the province.

Mo Mowlam - praised by the Prime Minister for her courage in the peace process

They have already themselves floated the idea for a "council of the British Isles" drawing members from Belfast, Dublin and London and the planned elected bodies in Scotland and Wales.

The proposals would almost certainly be opposed by Sinn Fein who see the Framework Document of 1995 as the very minimum they could accept.

Downing Street neither confirmed nor denied whether the idea of a Northern Ireland assembly based on proportional representation had been put forward as the basis for a potential settlement.

A spokesman would say only: "We are keen to see the various participants in the talks come up with all sorts of ideas."

"We don't believe it's helpful to talk about specific proposals until they are tabled."

The BBC's political editor, Robin Oakley explains the situation to Fi Glover (3'10")

But the BBC's political editor, Robin Oakley, who is with the Prime Minister on his visit to Japan, says that Mr Blair will have to tread a very careful line to keep both the republican and loyalist leaders happy.

Speaking in Japan, Mr Blair insisted that risks had to be taken for peace in Northern Ireland and paid a glowing tribute to Secretary of State Mo Mowlam, praising her courage.

But he refused to be drawn on the reports that he was planning a "council of the isles".

He said: "No, it is really a question of trying to find the best arrangement for the future that gives the people in Northern Ireland the stability in which they can plan their futures in a life of peace."

He conceded that options were being considered: "Discussions have been going on for a very long time at every level as you would expect and, of course, we want to make progress in these talks."

The peace talks at Stormont go ahead on Monday as scheduled but already republicans are reported to be "worried" about Mr Blair's plans because the Irish government would have no executive powers.
 

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