EU Finance Ministers and MEPs have yet to make a breakthrough on a compromise budget for 2014 - despite more than 12 hours of talks in Brussels.

The negotiations are proving to be very difficult as a wrangle over a €400m budget line for flood damage continues to be a stumbling block.  

Ministers want the European Commission to find the cash by making cutbacks in existing resources.

Yet MEPs are adamant that the EU budget cannot be cutback and demand that Ministers provide new money to make-up the shortfall.
Ireland is being represented by the Minister of State for Public Service Reform, Brian Hayes, who said the 'credibility' of the EU was on the line and it would be 'disastrous' if a deal was not done.

It is understood that one proposal negotiators are examining is the possibility of Finance Ministers splitting the payment of some additional funds across a number of years - but agreement continues to prove elusive.

A deal on the 2014 budget is viewed as very important because MEPs are due to vote on the EU's near one trillion euro 7-year budget at a meeting in Strasbourg next week. 

Under the Lisbon Treaty, the EU budget - known as the Multi-annual Financial Framework - cannot come into force without the backing of the European Parliament.

Asked if EU Finance Ministers were inquiring about Ireland exiting its bailout and possibly availing of an additional credit line from lenders, Minister Hayes said the topic was raised in bi-laterals as people were 'very interested in Ireland'.  

Asked about speculation that he might seek the Fine Gael nomination to run in next year's European Parliament elections in the Dublin constituency, Mr Hayes said he had not made his mind-up but added: "it will be a very difficult issue" for him.  

However, he said his immediate priority was working as junior finance minister and assisting Ireland successfully leave its EU / IMF programme next month.