Irish PM says UK agrees deal on N.Ireland policing

DUBLIN (Reuters) - British Prime Minister Gordon Brown has agreed a financial package to fund the devolution of policing and justice in Northern Ireland, his Irish counterpart Brian Cowen said on Wednesday.

The devolution of policing and justice will be an important step in the peace process in province, which has enjoyed relative peace since a 1998 deal that ended the Irish Republican Army's military campaign against British rule.

Irish Prime Minister Cowen told parliament that a deal had been reached following talks between Brown and Northern Ireland's First Minister and Deputy First Minister in London on Tuesday, the latest in a series of discussions.

Republican and pro-British partners in Northern Ireland's power-sharing executive had been at odds over the issue, which has threatened to destabilise the fledgling administration, and the deal removes a major stumbling block.

"I understand that a financial package to support the devolution of policing and justice was agreed and will be published today," Cowen said, adding he had spoke to Brown by telephone earlier on Wednesday.

"The first and deputy first ministers have indicated that they will consult with their colleagues and other parties on the package as well as having further talks between themselves to resolve any remaining issues."

Deputy First Minister Martin McGuinness, of the republican Sinn Fein party, had wanted the authority in Belfast's hands months ago but First Minister Peter Robinson of the pro-British Democratic Unionist Party had been holding out until he secured a deal on funding.

Earlier this month U.S. Secretary of State Hillary Clinton flew to Belfast to lend diplomatic muscle to the process, and Cowen said he was confident devolution would soon be completed.

"There are a few more steps to be taken before devolution finally takes place but I remain optimistic that it will proceed in the near future."