Thousands were killed or maimed amid 30 years of bombings and shootings in the north. How to address the legacy of the past remains a sticking point.
On Wednesday morning, while delivering key note address on 'Moving Politics Forward' in Belfast, Ms Villiers argued that many processes have almost exclusively concentrated on the activities of security forces rather than paramilitaries who were responsible for most cases.
Stormont is spending more than £30m a year on historical matters, with police trawling hundreds of thousands of documents, in part to investigate shootings carried out by former officers or soldiers.
Ms Villiers said: "At least with a new process, agreed by Northern Ireland's political leaders, there is scope to write in from the start the need for an objective balance and with proper weight and a proportionate focus on the wrongdoing of paramilitaries...rather than the almost exclusive concentration on the activities of the state which characterises so many of the processes currently under way."
Let’s face it, the vast majority of people in Northern Ireland don’t wake up on a Monday morning worrying about the past, flags or parades.
Dozens of inquests are probing Troubles killings while civil High Court cases are being taken in Belfast by victims alleging state collusion in murder.
The PSN has reopened some criminal investigations, has a dedicated team of detectives to probe old cases dating back to before the start of the conflict in 1968 for fresh leads and has to decide whether it is safe to disclose old records during countless inquests.
Victims on both sides have demanded justice for the loss of loved ones while human rights lawyers have argued that truth recovery is vital to help heal deep wounds which still exist in Northern Ireland society.
Ms Villiers said that the controversy over Government letters given to around 200 fugitive republicans telling them they were not wanted by police, following the collapse of the prosecution of John Downey for the Hyde Park bombing which killed four soldiers in 1982, demonstrates the need to deal with the past.
She added that the Government is prepared to compromise to help bring about agreement between local politicians.
"I appreciate the understandable concern that new structures and processes could lead to a one-sided approach which focuses on the minority of deaths in which the state was involved rather than the great majority which were solely the responsibility of the terrorists from whichever part of the community they came."
She maintained that a fresh approach is needed due to increasing pressure which the status quo is placing on Northern Ireland's institutions.
"There is scope for structured oversight by bodies representing different shades of opinion to try to keep the process fair and historically accurate...and to prevent it being hijacked by any one particular interest group or viewpoint.
"As we approach another marching season...there is no doubt that an agreement on the way forward on flags, parading and the past...even in outline...would send a powerful global message about the ability of Northern Ireland's politicians to find solutions even to the most diverse of issues.
"Crucially though I also believe that agreement on the Haass agenda could free up the space for politicians to focus more on other issues that are critical to our future...such as rebalancing the economy, reforming the public sector and building a genuinely shared future."
We need to put victims and survivors first, because when we do we will find solutions that are much more long lasting and are not simply pandering to a minority.
Victims Commissioner Kathryn Stone has cautioned the Secretary of State and other politicians on taking too "simplistic" a view on dealing with the past and stressed the importance of considering the impact of their words on victims and survivors.
She said: "Victims and survivors have given politicians a brave, dignified and progressive lead on what we need to do to address the very real and difficult issue of dealing with the past.
"I believe consistent acknowledgement of that effort and sensitivity to their feelings in any public debate should be part of a new political sense," she explained.
"I do not intend this as criticism but more as an illustration of how good intentions can be derailed if lip service only is paid to the sensitivities of victims and survivors.
"Putting them first should not just be political rhetoric but should be as fundamental a thought process as applying racial, gender or religious equality to any policy statements."
She added: "We can all agree with the secretary of state on the visceral reaction of the public after the prosecution of John Downey was halted, when she says it reinforced the need to find an agreed way forward on the past that allows us to put the era of side deals firmly behind us.
"Yet it is the reaction of victims and survivors that lasts much longer and is much more deeply felt than that of the general public.
"We need to understand that victims and Survivors are the living conscience of the past and that by giving them respect and dignity it will allow us to get on with building a better future for the people of Northern Ireland."