Taoiseach Enda Kenny travelled to London and Belfast on Monday for talks aimed at trying to seal a deal with the Northern parties this week that would stabilise the Northern Executive and Assembly.

Mr Kenny met British prime minister David Cameron in Downing Street and before flying to Belfast for talks last night with First Minister Peter Robinson and Deputy First Minister Martin McGuinness.

The British and Irish governments have put together the main elements of an agreement which they hope can be finalised and signed off on this week, possibly Thursday.

While there are still some difficulties to be resolved there is optimism that a deal will be closed this week.

“The mood is increasingly positive. It is not at an end but we are getting there,” a Government spokesman said following Mr Kenny’s meeting with Mr Robinson and Mr McGuinness.

Mr Kenny was also positive on the prospect after meeting Mr Cameron, saying he was “hopeful” of a resolution.

“In respect of the document that has been the subject of discussions, I would hope that would be concluded by the weekend, although obviously we’ll have to wait and see what the actual outcome will be,” said Mr Kenny.

Funding

Downing Street said the two leaders "discussed the political situation in Northern Ireland, reaffirming their commitment to the devolved political institutions and noting the importance of a rapid conclusion to the current cross party talks".

It is understood that part of Mr Robinson and Mr McGuinness’s talks with Mr Cameron and Mr Kenny focused on urging the British and Irish governments to commit more funding for Northern Ireland.

“Clearly some of the issues that have been raised by the parties in Northern Ireland concern major pieces of infrastructure,” said Mr Kenny when asked if any financial pledges had been made to help secure an agreement.

One of these projects is the stalled A5 road from the Border at Aughnacloy in Co Tyrone through to the border of Derry and Donegal.

“Yes we did commit monies in respect of the A5. Some of that has been allocated and we continue to honour the commitment we put forward there,” said the Taoiseach.

In the Assembly on Monday Mr McGuinness said an agreement could send a “very powerful message to those in society who believe violence represents the best way forward – that’s the road to no town”.

“What represents the best way forward for us are: working institutions, people being prepared to work on reconciliation processes and people working to ensure we provide foreign direct investment, support for our own local indigenous businesses,” he added.

SDLP leader Dr Alasdair McDonnell, however, said there were still “big gaps” to close before agreement could be reached. He said the public was tired of “half-baked deals” where sticking plasters are stuck over the issues.