By Ian Graham
BELFAST (Reuters) - The British government on Monday gave Northern Ireland's largest political parties a few more weeks to clinch a deal on a power-sharing regional government, staving off the risk of a suspension of devolved power for the first time in a decade.
Northern Ireland politics has been in crisis since Irish nationalist party Sinn Fein pulled out of government in January. A March 2 election ended the majority pro-British unionists had enjoyed in the province since Ireland was partitioned in 1921.
The expiration on Monday of a three-week deadline to form a government raised fears that devolved institutions set up under a 1998 peace agreement might collapse and power revert to the British government in London. The last time that happened it took five years to re-establish self-government.
While no one is predicting the political impasse risks returning Northern Ireland to the violence that killed 3,600 people in three decades, it could increase sectarian tensions and freeze decision-making as Brexit approaches.
"I think there are a few short weeks in which to resolve matters," Britain's Secretary of State for Northern Ireland James Brokenshire told reporters shortly after the deadline expired at 1500 GMT.
He did not explain on what basis more time would be given. While the law obliges him to call new elections, which would be the third in 12 months, it also gives him some leeway on when exactly to hold them.
He said there was no appetite for a return to direct rule from London, a move which would require the law to be changed, but which some feel could prove unavoidable if repeated elections fail to bring the parties together.
"I believe there is an overwhelming desire among the political parties and the public here for strong and stable devolved government," he said.
The crisis is an unwanted distraction for British Prime Minister Theresa May two days before she is due to trigger divorce proceedings to take Britain out of the European Union.
While Scottish First Minister Nicola Sturgeon has become one of the most vocal critics of May's Brexit strategy, Northern Ireland's leaders have been relatively muted. Both regions voted to remain in the EU in last year's referendum.
As the only part of the United Kingdom with a land border with the EU, Northern Ireland faces severe disruption to its economy. Any sign of border controls could inflame opinion among Irish nationalists who want a united Ireland.
"We desperately need local political representatives to speak on our behalf if we are to ensure that UK and EU negotiators have a proper understanding of Northern Ireland’s unique circumstance," the Northern Ireland branch of the Confederation of British Industry said after Brokenshire's statement. "There has seldom been a more important time to have a strong well-functioning Executive."
The crisis began in January when Sinn Fein pulled out of the province's government citing the "deep-seated arrogance" of power-sharing partner the Democratic Unionist Party over the DUP's handling of the abuse of an energy subsidy scheme.
Sinn Fein presented a long list of demands as conditions to re-enter government, including funding services for Irish language speakers, gay rights and inquiries into deaths during the decades of sectarian violence.
The DUP balked, suggesting Sinn Fein was asking for too much because it wanted the talks to fail.
"I wonder whether Sinn Fein were serious about reaching agreement at this time," DUP leader Arlene Foster said.
Sinn Fein leader Gerry Adams posted a video to the party's website that suggested he was not likely to soften its demands.
"Unionism is in my opinion at a crossroads. Whether it embraces everyone and upholds the rights of everyone ... or it doesn't," Adams said. "There can be no equivocation, no conditionality."
(Writing by Conor Humphries and Padraic Halpin; Editing by Catherine Evans)