Another crisis is looming at Stormont with the welfare reform bill expected to fall next week unless a last-minute deal is struck.
Intensive political talks were held on Wednesday and a further session is expected on Thursday, Northern Ireland Secretary Theresa Villiers said, in a bid to avoid collapse of the power-sharing institutions.
Sinn Fein Deputy First Minister Martin McGuinness has warned without a consensus his party will vote against the benefits legislation over concerns it could hit the most vulnerable. Unionists said that would make the budget to run public services unsustainable.
Ms Villiers said: “Failure to resolve the current dispute puts the whole Stormont House Agreement package in jeopardy and would see the Executive increasingly unable to deliver on its priorities for the people of Northern Ireland.”
First Minister Peter Robinson has claimed the executive is legally required to publish a spending plan by Friday of next week and declared without it the Assembly could collapse next week. Failure to agree cuts to benefits would leave a £500 million hole in the public finances, the DUP said.
Ulster Unionist leader Mike Nesbitt has said the impasse is “a proper crisis”.
Next week, Social Development Minister Mervyn Storey will bring the Welfare Reform Bill back to the Assembly as well as a new plan to put it in place.
The Northern Ireland Secretary added: “We had a constructive meeting this morning to discuss the dispute on implementing the welfare aspects of the Stormont House Agreement (SHA). The five parties agreed to do intensive further work over the coming days and we will meet again tomorrow.
“If it is implemented, the SHA will enable us to take significant steps forward on key issues such as the Executive’s budget, addressing the legacy of the past and making devolution work better.”
DUP leader Mr Robinson has said he will seek an Assembly vote on handing welfare powers back to London if Sinn Fein refuse to implement reforms of the benefits system.
He has insisted that, if his republican partners in the Executive refused to deal, an intervention by the UK Government would be the only way of preventing the collapse of the power-sharing administration in Belfast.
Despite agreeing to introduce the changes to the benefits system in December’s Stormont House political deal, Sinn Fein subsequently baulked at the move, claiming executive-funded top-up measures to support claimants losing out were not as comprehensive as they had envisaged.
Mr Robinson, who has accused the republicans of backtracking on the deal, has said mounting multi-million pound Treasury penalties for non-implementation, which are accruing at a rate of £2 million a week, will render the Executive unsustainable following June’s budgetary monitoring round.
He said this would force a senior civil servant to take control of the Executive’s purse strings, but with a restriction that only 75% of last year’s annual spend could be spent this year. The DUP leader said in such circumstances funds would soon run dry and the Executive would collapse, forcing a return to direct rule.
Mr McGuinness has said protecting the most vulnerable in society should be a priority.