Talks with the Democratic Unionist party (DUP) over post-Brexit trading arrangements have ended and it is time to restore devolved government in Northern Ireland, the Northern Ireland secretary has said. The announcement by Chris Heaton-Harris on Tuesday appeared to surprise and discomfit the DUP leader, Sir Jeffrey Donaldson, who said the party still had concerns and that talks would continue. The confusion overshadowed the offer of a £3.3bn financial package, which Heaton-Harris said was a final offer to stabilise the region’s finances and an inducement to revive the Stormont executive that has been mothballed since a DUP walkout almost two years ago. “It is disappointing that there will not be a new executive up and running to take up this offer and deliver it for the people of Northern Ireland before Christmas,” Heaton-Harris told reporters. “However, this package is on the table and will remain there, available on day one of an incoming Northern Ireland executive to take up.” The offer followed a week of roundtable talks about public finances with the four main party leaders at Hillsborough Castle amid a fiscal black hole, crumbling public services and strikes by transport, health and education workers. Since spring, the government has held separate talks with the DUP over the Windsor framework’s attempt to soften the Irish Sea border, which the party considers a threat to Northern Ireland’s place in the UK. “From our perspective the Windsor framework talks, all issues of substance have effectively concluded, but we are always happy to answer concerns and questions on this,” said Heaton-Harris. “It is now the time for decisions to be made.” Donaldson, however, said talks would continue. He said: “There is not yet agreement finalised on the issues of substance and we will continue to engage with the government to get to the point where that agreement is reached. We are not for giving up – we want to get this right.” There had been hopes of a breakthrough this week to end the DUP’s 22-month boycott of Stormont but Donaldson on Monday had signalled the need for more time and possibly concessions. The DUP leader also cast doubt on the financial package. He said: “It remains our view that there is not yet a basis within that financial offer to deliver the financial stability that Northern Ireland needs in the years ahead.” Mary Lou McDonald, the Sinn Féin leader, said the DUP had “rowed back” from a position last week when it seemed close to accepting a deal on the Windsor framework. She said: “People will be bitterly disappointed that government is still not formed.” Naomi Long, the Alliance leader, said the DUP must accept that talks on trading arrangements had concluded. “This is starting to feel a bit like a bad breakup, where one person has listed themselves on Facebook as single and the other one is still claiming it’s complicated,” she said. “These talks are over.”