Downing Street was advised at the weekend that the IRA had withdrawn its interlocutor to the International Commission, and was therefore unsurprised by yesterday's IRA statement.
The timing of the statement was obviously designed to put maximum pressure on the Prime Minister, Mr Blair, and the Taoiseach, Mr Ahern, who will hold crisis talks in London this afternoon.
British sources said the immediate effect of the IRA statement was to kill off any lingering hope the Taoiseach may have had of persuading London to rescind the suspension of the executive and other institutions of the Belfast Agreement, announced last Friday by Mr Peter Mandelson.
A Number 10 spokesman reiterated that the institutions could only be restored given "clarity" and "certainty" about republican intentions over decommissioning, which could only be provided through the international commission.
Describing the IRA statement as disappointing, Mr Mandelson said last night: "I believe this is a time when all channels need to be kept open. What was on the table had real potential and people will be sad that it could not be worked on and developed in the way that is needed."
The Shadow Northern Ireland secretary, Mr Andrew Mackay, said the IRA's decision to pull out of talks with Gen. de Chastelain was deeply regrettable: "It is essential that they fulfil their obligations under the Belfast Agreement and begin decommissioning their illegally held arms and explosives. The people of Northern Ireland expect nothing less."
Mr Charles Kennedy, the Liberal Democrat leader, said: "Following the hopeful events of the weekend this is disappointing and demoralising news. I would urge all those involved to keep a cool head. It would be a tragedy if others walked out of the talks in retaliation."
It was reported last night that, immediately following their summit meeting, Mr Blair and Mr Ahern would hold separate talks with Sinn Fein, the Ulster Unionists and the SDLP. However, a Northern Ireland Office spokesman said this was not definite.
It is understood Mr Blair's immediate priority will be to "restore a coherent sense" to the British-Irish position following Dublin's sustained opposition to the decision to suspend the executive and other institutions.
Specifically, Mr Blair will be seeking agreement with the Taoiseach on the terms for the review following suspension, how it is to be conducted and by whom.