Reports: Deal To Delay £1.7bn EU Bill Close

A deal is reportedly close to being agreed to defer the payment on Britain's £1.7bn EU bill until September 2015.

Sky's Europe Correspondent Robert Nisbet says it "appears we are edging towards a deal", whereby the deadline is moved, but he added there has - for now - been no change to the figure Britain must pay.

David Cameron earlier warned there would be a "major problem" if Brussels insists on Britain paying its £1.7bn EU bill in full.

The PM went on the offensive after a meeting with other European leaders in Finland, saying Britain would not pay "anything like" the full amount ahead of a looming 1 December deadline.

Mr Cameron said: "The two elements that I said were absolutely clear were that we wouldn't pay two billion euros on December 1 and we didn't believe in paying anything like that amount.

"Those are the two issues I put on the table. I hope they can be resolved at Ecofin. If they can be, then that will be good, and if they can't, then obviously we will have a major problem."

An option being considered in Brussels is to move the deadline for payment from December to a later date.

Proposals that have been circulated would see the bill being paid in instalments next year, rather than in full on 1 December. Interest payments would also be waived.

Chancellor George Osborne, who is attending a meeting of Economic and Financial Affairs Council (ECOFIN) ministers in Brussels, has started negotiations with the intention of delaying and reducing what the UK should pay.

Speaking before the meeting, Mr Osborne said the demand is "unacceptable", and pledged to "get a better deal for Britain".

Mr Cameron is trying to gain support for Britain's position at a meeting of northern European leaders in Helsinki.

The gathering is part of a two-day summit of Scandinavian and Baltic state leaders called the Northern Future Forum.

Mr Cameron told leaders from Finland, Estonia, Sweden, Denmark, Iceland, Latvia, Lithuania and Norway the demand, and the short notice, is "unacceptable".

The PM insisted the bill could not be treated as a "purely technical transaction", Downing Street said.

Mr Cameron said if there are changes to the scale of the bill and the deadline for payment "we can make progress, but if not, then I won't be content".

The aim of the meeting is to promote growth and economic reform, but Downing Street said beforehand the PM would also raise the issues of budget control and migration.

Mr Cameron's hopes of winning allies in his attempt to curb internal EU migration have been met with strong resistance from other European leaders, including hosts Finland. Sweden and Germany's opposition has also complicated the PM's task.

UKIP leader Nigel Farage said on his LBC radio phone-in that Mr Cameron is in a "real mess" and added: "From my knowledge of Europe and my knowledge of David Cameron, if he plays the tough man and doesn't pay it by December 1, he will pay it on December 2."

Labour's Ed Balls and Douglas Alexander said: "The Government must have all eyes on the detail of the deal being discussed, not looking back over their shoulders at the Eurosceptic backbenchers who still seem to be pulling the strings".