Ulster Unionist leader David Trimble has agreed a compromise with party hardliners on power-sharing strategy at a meeting of his party's ruling council.

At the meeting, called by the party's anti-Agreement faction at a south Belfast hotel, Mr Trimble faced a rival motion calling for graduated sanctions against Sinn Fein.

But as the meeting concluded on Saturday afternoon, Mr Trimble told reporters that the party had unanimously adopted a course of action which was a combination of the motions put forward to the council by himself and anti-Agreement MP Jeffrey Donaldson.

Mr Trimble said Ulster Unionist ministers would quit the executive at the end of the year if republicans did not show they were ending all paramilitary activity.

Dual strategy

He said in response to the "very strong feeling" of the council's 860-members they had set out a strategy involving both immediate and graduated action.

Gerry Adams: "Government must not give in to unionists"

The party was "fed up" with republicans' failure to act on violence and the government's failure to hold Sinn Fein to account, he said.

Irish Prime Minister Bertie Ahern said the decision of the Ulster Unionist Council was "regrettable and a cause for concern".

Mr Trimble said the first of "two key actions" would be an immediate end to participation in North-South Ministerial Council meetings in which Sinn Fein was involved.

The second would be to give Sinn Fein three months to prove that the Good Friday Agreement was being implemented in full with republican violence at an end.

If there was no move from republicans within the three months, Ulster Unionist ministers would the resign from the executive.

Within that time, Mr Trimble said, the party would meet prime minister Tony Blair and initiate talks with the other Northern Ireland parties to "see if there is a viable basis for future government in Northern Ireland".

Mr Trimble said the Ulster Unionist Council would meet again on 18 January.

Jeffrey Donaldson offered compromise

The compromise was agreed and a vote averted after Mr Donaldson offered to incorporate his party leader's proposals into his motion, during an adjournment of the meeting.

Mr Donaldson had proposed that the Ulster Unionist Party should immediately quit the North-South Ministerial Council and seek a meeting with the prime minister to demand he excludes Sinn Fein from government.

He said if Tony Blair failed to act, his party should pull out of the power-sharing executive while allowing the assembly committees to continue.

But it was agreed that the party would instead only pull its ministers out of north-south meetings which involved Sinn Fein, while continuing to work with the SDLP.

Face saving

The compromise motion is being seen as a means in which both sides of the party have been able to save face and avoid further division in the run-up to next spring's assembly election.

The special meeting was the ninth such meeting of the Ulster Unionist Council at which David Trimble's policy and authority has been challenged.

But Mr Trimble denied that, by moving towards Jeffrey Donaldson's position, he was now a prisoner to party hard-liners.

"We are both wearing our own clothes and we are both wearing the party's policy," he insisted.

He added: "The Ulster Unionist Party won today and the people of Northern Ireland won today because the people of Northern Ireland now, as a result of this, can see the added spur on the paramilitaries to complete the transition and to get the full promise of the Agreement delivered."

Mr Donaldson welcomed the compromise which he said would halt the "drift" of the republican position.

'Wreckers' charter'

Sinn Fein President Gerry Adams said the Ulster Unionist Party had signed up to a "wreckers' charter" and that the government must not concede any more concessions to unionists by allowing them to halt the political process.

SDLP leader and Deputy First Minister Mark Durkan said the Ulster Unionists had adopted an anti-Agreement agenda which was jeopardising devolution.

But Northern Ireland Secretary John Reid said: "All involved in this process must be able to have confidence that the Belfast Agreement will be implemented in full," he said.

He said the government would hold further discussions with Mr Trimble and the leaders of the parties.