Between the fish and chip supper and a car without a fax, why did the talks really fail?

With a harrumph, John Prescott sat down. "Talk, don't walk!" he told firefighters in his emergency statement to MPs on Thursday evening. And they did – for the next 13 hours.

But by 9am the next morning, the firefighters were back on the picket lines, their union leaders were shattered and incredulous, their local authority employers worn out and frustrated and John Prescott was emerging adamant from a radio studio in a towering rage. The strike was back on, no deal was in sight and the increasingly fragile alliance between Labour and the unions was close to breaking.

The intervening hours with all their to-ing and fro-ing had yielded nothing. But who was to blame?

Government sources insist the real story begins in Blackpool at a private meeting between a group of ministers and officials, deputed by the Prime Minister, and Andy Gilchrist, the general secretary of the Fire Brigades Union. The hope was to "find out what the game plan was, to establish whether there was an alternative to 40 per cent".

It failed. "We have never been able to get to the bottom of what he will settle for," said a source. "Even by Thursday lunchtime, Prescott still had no idea of what it is he wants."

Confused by the union's strategy, ministers had the additional problem that they did not trust the people who were negotiating on the employers' side. The Local Government Association, which represents the various fire authorities around the country, has an unwieldy structure which entitled between 30 and 40 people to take part in negotiations. Some were Old Labour councillors who frankly believed that the firefighters should be given what they asked for and that the Government should foot the bill.

The only person the Government really trusted was the LGA's experienced chairman, former Newcastle City Council leader, Sir Jeremy Beecham – but he was not a member of the negotiating team.

During a long day and night of negotiations, the FBU's 19-strong executive waited in the library of the Russell Hotel in central London, with the employers half a mile away in the Covent Garden suite of the New Connaught Rooms. Two teams set out for secret talks on neutral territory, at the Plaza Hotel, near Euston station. They were Mr Gilchrist, FBU president Ruth Winters and assistant general secretary Mike Fordham for the firefighters; Ted George, Ian Swithenbank, Charles Nolda and Phil White for the employers. Also around the table were TUC general secretary John Monks and his deputy Brendan Barber.

John Monks was pleased by what seemed to be the helpful attitude on both sides as they inched to an agreement. By 2.30am, the employers were having a late fish and chip supper as they put finishing touches to a new draft agreement.

At 3.15am, the TUC delegation turned up at the Russell. "That was the signal there was a deal," an FBU source said.

And then it came. 4.16am. The fax machine whirred and two pages squeezed out. Delighted with the contents, which included several important concessions from the employers, Andy Gilchrist then fought a fierce battle with his own executive to push through a deal which he believed his members would accept. By sheer force of persuasion, he managed to coax the dissenters to give the draft unanimous backing.

Unfortunately, the employers' negotiators had not cleared the deal with the Govern- ment, which was expected to pay for it. Nick Raynsford, the fire service minister, had sat up all night in his Greenwich home, speaking with them occasionally and agreeing some of the technical details. He had also talked to John Prescott – who was not, contrary to rumour, tucked up in bed.

Some time after 6.00am, Mr Raynsford's fax machine came to life. It was a message from Sir Jeremy , at home in Newcastle, which included the full text of the proposed agreement. Within minutes, a furious Nick Raynsford was on the phone, accusing the employers of giving in without getting anything in return.

This news was conveyed to Andy Gilchrist by a shamefaced Phil White. Mr Raynsford insisted that his boss John Prescott could not give his detailed response to the draft agreement until 9.00 am, hoping the FBU would delay the start of their strike so that negotiations could continue. But Mr Gilchrist insisted he needed an answer by 7.30. He could not see why it should take so long to read a two-page document.

"There was no hope that we could call off a national strike even with mobile phones moulded to our heads in less time than that," said an FBU source.

Unknown to the firemen, Mr Prescott was literally unable to read the disputed document. Having been told about it over the telephone, he had decided to order a Government car to take him straight away from his grace and favour mansion in Dorneywood to his Whitehall office. There was no fax machine in the car. He still had not seen the document when he made his furious appearance on BBC Radio 4's Today programme at 8.10.am

The Government used the morning to pin the blame elsewhere. All day Friday, key Blairite ministers, including the party chairman, John Reid, and the Welsh Secretary, Peter Hain, pounded the media with the message: the deal was uncosted and unspecific.

And while the original draft agreement made reference to the review by Sir George Bain on reforming the fire service and was quite specific in setting out a modernising agenda in return for more money, its 4.00am successor was not. According to the Treasury, it represented an extra cost of £450m a year, not covered by any savings.

The events of Friday morning have created widespread suspicion among union leaders that Downing Street was spoiling for a fight all along. Much of the suspicion originates from a remark made by Tony Blair himself about there being "Scargillites" on the loose in the trade union movement – although ministers have since claimed that it was not aimed at union leaders like Mr Gilchrist, who is a Labour Party member, but at the more militant railwaymen's leader, Bob Crow, who supports the far left Socialist Alliance.

After all that, there is only one thing everyone does agree on: it's back to square one.

Strike players: who's who in the stand-off

John Prescott

Everyone's favourite fall guy, the Deputy Prime Minister got the 3am call after the fire service employers clinched a watered-down deal with the FBU. Very much a union man, he is totally on side with the Prime Minister and the Chancellor on this one.

Sir Jeremy Beecham

The Local Government Association chair hoped his friends in government would put up the cash to resolve the dispute. With a fraction of the money demanded at their disposal, his own negotiators have been accused of caving in to the firefighters.

Andy Gilchrist

The leader of the Fire Brigades Union says he will only drop his 40 per cent pay demand if a "sensible" proposal is made. Without extra government money, he and his members either have to capitulate or fight on. His frustration is second only to his fury.

Gordon Brown

Faced with the economic ramifications of a sizeable wage increase for the firefighters, and knowing that a wage hike independent of reform could prompt a flurry of demands and counter-demands, the Chancellor has little choice but to stand firm.

Bob Crow

The Rail, Maritime and Transport union boss tried to give the firefighters extra muscle by threatening to take his members – the Tube drivers – out on strike too. But the strategy of frightening the Government with trade union unrest appears to have failed.

John Monks

The TUC general secretaryweighed in to give bulk and credibility to the FBU and act as a bridge between union and Government. Close as he is to Tony Blair, Mr Monks's intervention could not budge the Government, leaving him to lament this "family row".