THE Ulster Volunteer Force is on the verge of calling off its ceasefire despite claims to the contrary by other loyalists, according to senior UVF sources.
The UVF held a series of "consultative" meetings among its membership the week before last, and the sources say the consensus from the meetings was that the ceasefire should end.
It was concluded that the loyalists had gained little or nothing from holding on to their ceasefire after the IRA renewed its campaign of violence.
The UVF also believes there has been a substantial shift in opinion among nationalists towards Sinn Fein's position, and that the only way to counter this is to return to violence.
Asked if the organisation was close to calling off its ceasefire, a senior figure said: "You could say that all right".
The UVF dismissed suggestions last week that it would not be prepared to unilaterally call off its ceasefire without consulting the Ulster Defence Association (UDA), with which it has a kind of partnership in the Combined Loyalist Military Command (CLMC).
Figures close to the UDA last week disputed reports that there were moves within the UVF towards ending its ceasefire. The UDA's views were described by UVF sources as "irrelevant".
The UVF also said it was mystified by suggestions from the clergyman and intermediary, the Rev Roy Magee, about "middle class loyalists" who were said to be putting on pressure for a return to loyalist paramilitary violence.
The UVF cited recent statements by political figures in the Republic as evidence that Sinn Fein was continuing to make political gains from the resumption of the IRA campaign.
They referred specifically to the speech by the Fianna Fail leader, Mr Ahern, at Arbour Hill two weeks ago, blaming the British government and the Taoiseach, Mr Bruton, for the breakdown in the IRA ceasefire; and last week's statement by Mr Fergus Finlay of the Labour Party that political talks in Northern Ireland without Sinn Fein would not be worth a penny candle.
The UVF's position has changed significantly since February. Immediately after the IRA ended its ceasefire the UVF held that the IRA had made a major political blunder by returning to violence.
More recently the view within the UVF has changed dramatically.
Last month the political party which closely reflects thinking with the UVF, the Progressive Unionist Party (PUP), cut off direct links with the Government after a dispute concerning the Tanaiste, Mr Spring.
The PUP leader, Mr David Ervine, came under criticism from within his loyalist constituency for maintaining links with Dublin until then.
Communication between the Government and PUP is now through intermediaries. Despite differences with the Government, senior UVF figures had taken the view, until recent weeks, that there would be no benefit in calling off their ceasefire.
It is also the UVF view that the IRA will not call another ceasefire, on the grounds that it can make greater political gains from bombs or the threat of bombs.