Minister of State Alex White has warned a new agreement on public service pay will be a lot more difficult to achieve without a deal on the promissory note banking debts

Mr White told RTÉ's The Week in Politics that it would be harder to persuade people to "take further hits" in their pay without a deal.

The junior minister at the Department of Health said a deal is "indispensable" to the country's economic recovery.

Responding to his party colleague Senator John Gilroy's call for a general election if an agreement is not secured with the ECB, Mr White said he would not engage in "apocalyptic predictions".

He insisted that there is "intense diplomatic activity" under way and the Government is confident of a positive outcome.