The Northern Ireland Secretary, Mr Paul Murphy, has said the British government will not abandon its commitment to the "ultimate goal" of an inclusive political settlement despite the "deeply damaging" impact of the Northern Bank robbery attributed to the IRA.
At the same time Mr Murphy has raised the prospect of "penalties" that might be applied to Sinn Féin, and of seeking alternative interim political ways forward. This follows his admission that he could not foresee with certainty an inclusive power-sharing executive at Stormont.
He has also raised a serious question mark over the possible devolution of policing powers to any future Northern Ireland administration in the first real signal of a possible recasting of the British government's agenda.
Mr Murphy was speaking in the House of Commons ahead of a one-hour meeting between Mr Tony Blair and the Rev Ian Paisley in Downing Street yesterday afternoon, at which the DUP leader pressed the British Prime Minister to allow the North's political process to proceed without Sinn Féin.
Dr Paisley will meet Mr Blair again shortly to present specific DUP proposals. However, senior British sources are privately dismissing the possibility of a "voluntary coalition" involving both unionist parties and the SDLP, and say they would in any event only consider such an option if it commanded the support of the Irish Government.
One authoritative British source told The Irish Times that a more likely focus would be on the possible marriage of DUP proposals for Stormont Assembly scrutiny committees and an earlier SDLP suggestion that civic commissioners be appointed to discharge the work of the power-sharing Executive pending any new political deal.
However, the source conceded that the prospect of agreement on such an arrangement was not high, and that it would almost certainly be opposed by Mr David Trimble's Ulster Unionists.
In his statement to MPs reiterating his "utter condemnation of those who planned and carried out this appalling crime", Mr Murphy said the PSNI chief constable's judgment that the Provisional IRA was responsible for the Northern Bank robbery was "well founded".
Having been briefed fully on the background to the statement he made attributing responsibility last Friday, Mr Murphy assured the House of Commons that Mr Hugh Orde had not "rushed to judgment".
Former SDLP leader Mr John Hume pressed Mr Murphy to agree that - given Sinn Féin denials of republican responsibility and the damage being inflicted on the peace process - it was necessary that the evidence be published.
However, Mr Murphy said he had seen "a great deal of the evidence" and had no doubt that what the chief constable had said was right.
Challenged on the same point by the Liberal Democrats spokesman, Mr Lembit Opik, Mr Murphy repeated that it was not unusual for the chief constable to attribute blame across the board while doing nothing to the possible detriment of any future court action.
Mr Murphy again went out of his way to stress that this had been "in no sense a victimless crime". And he insisted: "The enormity of that robbery, and the savagery that went with it, is such that people can take no more."
At the same time Mr Murphy told Labour MP Ms Kate Hoey that "the most important thing is to seek to stop the criminality" which would ultimately enable the inclusive political settlement he believed the people of Northern Ireland and the island of Ireland still wished to see.
"Ruling nothing in or out", Mr Murphy resisted a series of Conservative and unionist demands for specific sanctions against Sinn Féin, insisting these could only be properly considered in the context of future discussions with the Irish Government and the Northern Ireland parties.
Signalling a possible rethink on the proposed devolution of policing powers, however, Mr Murphy said: "Let me reiterate . . . that this government will not promote a political settlement in which a party inextricably linked to an organisation which has carried out major criminal acts can assume responsibilities again in a devolved administration."