Intensive negotiations to restore power-sharing in the North will only begin if the Independent Monitoring Commission (I MC) reports in January that the IRA is honouring its commitment to end all illegal activity, the Irish and British governments indicated today.
Despite the IMC's acceptance that the IRA has stuck to the terms of its historic declaration in July, Minister for Foreign Affairs Dermot Ahern and Northern Secretary Peter Hain, said more time was needed to build confidence.
They agreed that there had been a "sea change" in Northern politics since the IRA declaration but that unionist hesitancy was understandable.
"There is movement in the right direction. There is more to be done, nevertheless there are positive signs of progress," Mr Ahern said.
Mr Hain said that his information was that the IRA was continuing to honour its commitment beyond August 31st - the period covered by the report - which was further grounds for optimism.
"The signs are very encouraging, but we as governments want to be certain that the promises made on July 28th are being delivered over a period of months and the scepticism within the unionist community is very understandable given what has happened in the past," Mr Hain said.
"The January report is going to be an absolutely critical benchmark of where we are," he added.
Both men described their meeting as a stock-taking exercise in which issues such as cross-border smuggling, an all-Ireland mobile phone network and an application to host the World Rally Championships on the whole island in 2007 were discussed.
The thorny issue of policing boards - central to the restoration of power-sharing - should not be used a political football with Mr Hain insisting that the Patten reforms remain the "template for the future".
He also announced that Westminster allowances would be restored to Sinn Féin in light of the report but financial sanctions imposed on the PUP would remain in place despite signs that loyalist paramilitaries may be ready to declare an end to their illegal activities.
A joint-communique issued after the meeting, held under the auspices of the Intergovernmental Conference, condemned loyalist feuding and commended the PSNI for dealing public order offences arising out of the marching season.
However, the communique also referred to the need to encourage, and engage with loyalists. Mr Ahern said Government officials had been involved in regular and positive contact with loyalist groups. The Ministers are due to meet again in January.