The Ulster Unionists and Sinn Fein must keep talking until they reach an accommodation which suits both traditions, Dr Mo Mowlam has said.
Decommissioning must take place but it is an obligation, not a precondition, the Northern Secretary said. "What is important is that they keep talking and find an accommodation they can both live with," she said.
She insisted there was no question of "parking" the process, as the same difficulties would remain and the only way to build necessary trust was to keep talking. There was no new deadline as the parties needed "space and time to work out between themselves a way forward".
No agreement was reached after five hours of talks at Downing Street on Monday involving the Taoiseach, the British Prime Minister, the UUP, Sinn Fein and the SDLP. The talks are due to resume next week.
"It's about building confidence and trust between the two sides to allow both sides to move. People want it to work. We shouldn't forget that," she said. There were ideas in the Hillsborough Declaration and proposals from other parties which could help, she added.
Sinn Fein has rejected the Hillsborough Declaration which calls for "some arms to be put beyond use". Ms Mowlam said she was quite willing to trigger the formation of the executive, but only if the parties believed progress could then be made.
A UUP negotiator, Mr Dermot Nesbitt, said his party's position remained unchanged. It was not willing to share power with a party inextricably linked to an armed paramilitary group. But he denied this was a blanket attempt to exclude Sinn Fein from government.
"The UUP wishes to see as inclusive a form of government as possible. The more inclusive it is, the more likelihood it has of succeeding," he said. But the Deputy First Minister, Mr Seamus Mallon, accused the UUP and Sinn Fein of holding the other parties to ransom while they "vandalised" the peace process.
He urged the British and Irish governments to make it clear that these two parties must compromise in order to implement the Belfast Agreement. "I am concerned and angry that that which belongs to the people of Ireland is being vandalised by two of the parties for their own political reasons.
"It's a matter of the Ulster Unionists and Sinn Fein deciding whether they want to hold on to the political process or whether they want to hold on to their precondition on the one hand or adherence to non-decommissioning on the other. We are being held to ransom by the positions of two political parties.
"Sooner or later the rest of the political parties and the two governments have got either to move them from those positions or face up to the fact that because of this issue those two parties will have been allowed to bring this agreement to an end."
Mr Mallon said the process must not be parked.
Also yesterday, Sinn Fein accused the First Minister, Mr David Trimble, of holding the political process to ransom and called on the governments to adhere to the terms of the agreement.
The party chairman, Mr Mitchel McLaughlin, said: "Conceding to Mr Trimble's blackmail threat to walk away from the agreement if he doesn't get what he wants is not the way to end this crisis and move the peace process forward."