The Ulster Unionist Party has rejected the proposals put forward at Stormont last week, accusing Sinn Fein of deceiving the British and Irish governments about the IRA's intention to decommission.
The Ulster Unionist leader, Mr David Trimble, said he had great difficulties with the proposals. He said unionists had problems with the timing, commitment and the "failsafe" mechanisms to ensure promises were kept by all sides. The proposals needed "more than a few cosmetic changes" to persuade unionists to sign up to them.
Mr Trimble said he had been in contact with Mr Blair to express his concerns about the proposals. He asked why democrats should be punished if terrorists failed to decommission.
Proposing an end to the executive if decommissioning failed to happen required unionists to "make a leap in the dark without an effective safety net", said Mr Trimble.
There was an effective sanction if decommissioning did not occur, and it was critical to the whole operation if it was to proceed. That all the institutions be suspended just because a paramilitary organisation, which could be the IRA or the UVF, failed to live up to its obligations "and the democratic politicians suffer". He said it was not a reasonable or a fair proposition for the two governments to ask the unionists to do. "Why are things arranged so as to be comfortable for the terrorists and difficult for the democrats?" asked Mr Trimble.
He said the IRA was holding democratic politicians to ransom, and the British government was aiding the men of violence.
Party officers unanimously voted to reject the deal at a special meeting on Saturday at UUP headquarters in Belfast.
Mr Trimble said members had expressed concern about Sinn Fein's commitment to peace. They could not accept the proposals as they stood.
The First Minister said unionists were questioning republicans' true intentions about decommissioning after an assurance from the British Prime Minister, Mr Tony Blair, during the negotiations at Stormont that both Sinn Fein and the IRA would issue a statement saying "the war is over" failed to materialise.
"That leaves my colleagues with a very great concern. A lot of them think that this is a con job by Gerry Adams and that unfortunately Tony [Blair] has been deceived. I share these doubts myself," said Mr Trimble.
He called on republicans to make a commitment to decommissioning before devolution was put into effect, to prove their genuine desire for peace.
Both pro- and anti-Belfast Agreement unionists were united in their opposition to the proposals, which would lead to the formation of a power-sharing executive, with the IRA later handing over weapons. That did not guarantee decommissioning.
Mr Ken Maginnis, Ulster Unionist MP for Fermanagh-South Tyrone, said: "It's not an option, but an ultimatum, which we cannot accept. It's a bridge too far."
He said the assertion by Mr Blair and Mr Ahern that they believed the IRA was prepared to start handing in its weaponry was not enough.
"Expectations are not what it's about. It's about guarantees," he insisted.
The Ulster Unionist MP for Lagan Valley, Mr Jeffrey Donaldson, who voted against the Belfast Agreement, said Mr Blair would have to renegotiate the proposals put forward at Stormont on Friday or they would be rejected.
"It's an absolute disgrace that the Prime Minister is asking a democratic party to sit in government with representatives of a fully-armed terrorist organisation," he said.
Despite the unionist objections, Mr Trimble said his party's executive would meet next week to discuss the plans and, if necessary, "we will take our decision if it comes to it on the morning of July 15th" when devolution is due to get under way.
The Northern Secretary, Dr Mo Mowlam, appealed to unionists to consider the proposals, which give them the prospect of full IRA decommissioning for the first time. Dr Mowlam said even if the plan failed, no one would be worse off.
Earlier the Security Minister, Mr Adam Ingram, said he was confident Sinn Fein could deliver on decommissioning. The British government had said all through the process that "those who are speaking for the IRA are genuinely seeking a . . . peaceful future for Northern Ireland. Our assumption would be that they can deliver."
Deaglan de Breadun adds: The Ulster Unionist Party's Assembly Member for Mid-UIster, Mr Billy Armstrong has strongly criticised the latest Anglo-Irish initiative in the peace process.
"This document states that if Sinn Fein/IRA don't decommission the whole Assembly would be suspended and we cannot accept that. We would all be punished for the wrongdoings of Sinn Fein/IRA. We, the Ulster Unionist Party have wrought in good faith with all parties to achieve a Stormont government. The Assembly has to go on without Sinn Fein unless they begin a credible and verifiable process of decommissioning," Mr Armstrong said.