Police officers in Northern Ireland are to keep their special duty allowance which is paid to them because of the extra threat.
Nearly £3,000 a year is paid to each officer and it was thought the allowance would be scrapped under a review carried out by the NIO.
The amount paid will be reduced but it will remain until 2009.
General Secretary of the Police Federation Terry Spence said the extra payments were justified.
"There is still an ongoing terrorist threat in Northern Ireland, our officers are still subjected to attack," he said.
"As well as that, of course, is the fact that some of our officers are still moved house and find themselves in a difficult position with their families having been subjected to terrorist threat."
I can assure you that this allowance does not compensate adequately some officers for the hardship caused by criminal elements right up to the present time.