Talks to end the political deadlock in Northern Ireland are far from over, Minister for Foreign Affairs Charlie Flanagan has said.
The future of Northern Ireland's power-sharing Executive had been left mired in uncertainty after a failed bid by Taoiseach Enda Kenny and British Prime Minister David Cameron to resolve a series of major disputes.
Mr Cameron left Belfast without reaching the agreement he had hoped for when he arrived to join cross-party talks on Thursday.
But negotiations involving the five North parties continued at Stormont House after Mr Cameron and Mr Kenny departed. They are now set to resume in the middle of next week.
Mr Flanagan said this evening that he was disappointed that the Taoiseach and the British Prime Minister left when no agreement had been reached but that the talks were far from over.
He told RTÉ’s Six One News that the parties had a constructive and focused afternoon of discussions.
He said that agreement had been reached on a wide range of topics and that just 20% of issues remained unresolved.
He said that the British government was offering investment and that it was conditional on welfare reforms.
Mr Flanagan said it was significant that Mr Kenny and Mr Cameron had urged all parties to reach agreement between now and Christmas Eve.
Speaking earlier, the Taoiseach said he genuinely felt a deal could be done.
"I have to say the document that was tabled last evening is comprehensive and does address all of the issues that have been involved here for the last period," he said.
Mr Kenny added: "From the Government's point of view in Dublin, we will continue to be available, along with the British government, to assist, to encourage, to co-operate and help in any way possible here."
During a long night of negotiations at Stormont House, both leaders tabled a range of proposed solutions on vexed wrangles on flags, parades, the legacy of the past, reform of the Assembly and the Executive's serious budget crisis.
Mr Cameron offered what he described as £1bn (€1.3bn) of increased spending power over six years, conditional on an agreement being struck on the swathe of logjams destabilising the administration.
But the North’s politicians failed to sign up to the document and rejected the financial offer as not credible, raising the looming spectre of a possible collapse of the institutions and a return to direct rule.
While many of the issues on the agenda of the talks are peace process logjams that have rumbled on for years, the budgetary problems, in particular the impasse over the non-implementation of the British government's welfare reforms due to Sinn Féin opposition, pose an immediate threat to the institutions.
Ministers in Belfast have already had to ask for an emergency £100m loan from the UK Treasury to balance their books this financial year, and if a deal on welfare reform is not agreed they will face about £200m of government penalties for non-implementation.
As it is unlikely the five-party administration would be able to absorb such a financial burden, the future of the Executive effectively depends on a resolution to the welfare reform issue.
Many of the politicians have conceded that Christmas is an effective deadline for resolution, as positions will undoubtedly harden as the UK general election looms in the new year.
Mr Cameron insisted the package on offer would give new "financial firepower" to the Executive.
But he warned: "If there isn't an agreement, then that financial firepower isn't there."
The prime minister said "intensive work" needed to be done to ensure the Executive's budget was sustainable.
"I think a deal is possible. It's possible because I think the parties have done a lot of good work on the issues that need to be settled - the issue of how to manage parades, how to handle the past, the issues of flying flags.
"The real work that still needs to be done is to make sure that the budget of the Northern Ireland Executive is sustainable and works, so intensive work needs to be done between the parties on that issue."
Regarding his offer of £1bn, Mr Cameron said a "comprehensive agreement" was needed to release it, rather than "simply some words about these issues".
First Minister Peter Robinson and Deputy First Minister Martin McGuinness both questioned the credibility of Mr Cameron's offer, insisting hardly any new money was on the table.
It is understood the majority of the British government's proposed financial package relates to extending greater flexibility to the Executive to draw down and borrow funds.
DUP leader Mr Robinson said the offer had to be improved.
"In terms of the package from the prime minister I don't think it was adequate," he said. "I think if he wants to bribe us, to bribe us with our own money comes a bit short of what's required."
Mr McGuinness said: "Whatever you have been told by the prime minister, there was no credible financial package offered to the Executive ministers to allow us to combat the austerity agenda that this British government has been inflicting on us."
Mr McGuinness said he did not want to see the institutions collapse.
"We don't want Stormont to crash, we want these institutions to continue," he said.
While critical of Mr Cameron's offer, Mr Robinson also claimed the Executive had been unable to test the prime minister's bottom line as Sinn Féin's stance on welfare reform had undermined their negotiating position.
Mr Robinson acknowledged there would be less inclination to compromise after Christmas.
But he stressed: "I don't like putting up timetables, we have a very long standing habit in Northern Ireland of flying through deadlines.
"The reality is we need to just roll up our sleeves and get down to the work and see where it takes us."
