Anti-agreement unionists have accused Mr Peter Mandelson of hypocrisy in returning Johnny Adair to prison while "turning a blind eye" to continual breaches of both the UVF and Provisional IRA ceasefires.
Democratic Unionist Party secretary, Mr Nigel Dodds, said the UVF was "clearly responsible" for the murders of Jackie Coulter and Bobby Mahood on the Shankill on Monday. He said the Provisional IRA had killed an alleged drug dealer, Mr Ed McCoy, and was responsible for the bomb that exploded prematurely in west Belfast earlier this summer, yet no sanctions had been applied to these paramilitary groups or their political representatives.
"Peter Mandelson has allowed a situation to develop where terrorists have literally got away with murder and where violence has gone unpunished, and indeed rewarded, as in the case of the IRA whose political front has been placed in government.
"It is not enough to jail one man when entire terrorist organisations remain intact, stay armed to the teeth and continue to carry out murders as it suits them."
The Progressive Unionist Party, the UVF's political wing, has refused to condemn the UVF double murder.
Mr Dodds said: "Will Mr Mandelson be taking action against the political fronts of paramilitary organisations who have refused to distance themselves from these terrorist acts? I think not."
The leader of the UK Unionist Party, Mr Bob McCartney, accused Mr Mandelson of inconsistency. "First he declares that the recent violence is an outbreak of criminal gangsterism, hence no paramilitary ceasefires have been breached.
"In the next breath, he declares that Johnny Adair, an acknowledged paramilitary leader, has been concerned in the commission, preparation, or instigation of acts of terrorism and must be returned to jail."
Mr McCartney said returning Adair to prison was meaningless. "Having sacrificed whole areas of the province to terrorists, it is an empty gesture to jail one denison of darkness and leave a legion of his colleagues on the loose."
An Ulster Unionist councillor, Mr Jim Rodgers, said Adair's arrest could prove a mistake. "This will make it extremely difficult to have mediation in the loyalist feud," he said.
However, UUP security spokesman, Mr Ken Maginnis, welcomed the arrest, which he hoped would signal the start of a crackdown against organised crime linked to paramilitaries. SDLP Assembly member, Mr Alban Maginness said Mr Mandelson had no other option but to return Adair to jail. "These paramilitaries were released from prison because they gave their support to the Good Friday agreement and to peace.
"By their recent actions that support has been reduced to meaningless lip service. It is time for loyalists to stop what they are doing to their own people and the community as a whole and to commit themselves for once and for all to the agreement and total peace."
The Alliance deputy leader, Mr Seamus Close, also believed Mr Mandelson had made the right decision. "It is now imperative that the rule of law is reasserted throughout Northern Ireland and that confidence is restored to those decent citizens who have been living in fear."
The shadow British Secretary of State for Northern Ireland, Mr Andrew MacKay, supported Adair's return to jail. "We welcome the fact that Mr Mandelson, after displaying dither and prevarication, is now implementing Conservative policy by suspending Johnny Adair's licence. Our regret is that he didn't take firm and decisive action sooner."
Mr Mandelson strongly defended his decision yesterday. "The legislation enables me to act on the basis of my belief that he [Adair] has or is about to commission acts of terrorism.
"I received a pretty strong case, very full information from the RUC and I acted on that. He has been pursuing and associating himself very directly with acts of violence."
The Northern Secretary held out an olive branch to the UDA's political wing, the Ulster Democratic Party. He said he wished that the party, which has no Assembly members, had succeeded in securing electoral representation at Stormont. "I do what I can to compensate for that, to draw them into the political process all the time. They are people of good quality and integrity."