PMs seeking to restore devolution

Tony Blair and Bertie Ahern discussed the Northern Ireland process

The British and Irish governments are seeking ways to restore devolution in Northern Ireland, the UK prime minister has said.

Tony Blair said both administrations wanted to create the circumstances for re-establishing the political institutions.

However, he warned that loyalist violence was "a threat to the stability of Northern Ireland".

Mr Blair was speaking after talks with Taoiseach Bertie Ahern in London.

It was their first meeting since General John de Chastelain said that the IRA had completed its disarmament.

Hopefully on the strength of two IMC reports... we will be able to work towards re-establishing the institutions again and make them work successfully, as difficult as that might be Bertie Ahern Irish prime minister

Mr Blair said that had been "a genuinely significant change in the politics of Northern Ireland".

"We have now got coming up, the Independent Monitoring Commission report in the next couple of weeks and then there is a further report next year," he said.

"The important thing is to create the right confidence in all parts of the community... indeed that devolved government can happen and can be stable.

"This is why it's important that there is a change of culture on all sides."

This was important given recent loyalist violence, said the prime minister.

The violence was "totally unacceptable and also a threat to the stability of Northern Ireland", he said.

'Start talking'

Mr Ahern said it was the first time both leaders had been able to hold talks without the shadow of IRA guns.

"It doesn't solve all the problems, but it certainly is welcome," he said.

"Hopefully on the strength of two IMC reports... we will be able to work towards re-establishing the institutions again and make them work successfully, as difficult as that might be.

"It is important Dermot Ahern, the foreign minister, and Peter Hain, the secretary of state, who meet next week in the British-Irish inter-governmental body, start talking to the parties."

Both leaders refused to say if they believed allegations of IRA money-laundering last week contravened the IRA's pledge to end all paramilitary activity.

Mr Blair said it would be up to the Independent Monitoring Commission to judge whether any alleged money laundering was in breach of the IRA's recent pledges.

Meanwhile, the government is publishing a bill renewing its emergency anti-terrorist powers in Northern Ireland.

The NI Terrorism Bill is designed to keep the current provisions active until July 2007, which is the government's target date for dropping the powers - provided paramilitary activity has come to an end.