James Brokenshire, the Northern Ireland Secretary, has once again extended the deadline for the Democratic Unionist Party and Sinn Féin to reach a deal to restore power-sharing.

Mr Brokenshire had previously threatened to impose a partial form of direct rule for Northern Ireland by legislating for a budget for the region if the parties failed to come to agreement.

But on Monday evening the DUP and Sinn Féin left Stormont without agreeing a deal and the Northern Ireland Secretary said he was going to defer his decision on a budget.

In a statement Mr Brokenshire said: “The parties have made further progress during the course of today. They are making certain additional request of the UK Government which we need to consider.

“In light of this, I believe it is right to defer the assessment on whether to introduce legislation to Parliament the week to enable an Executive to be formed.”

Despite endless rounds of discussions between the DUP and Sinn Féin the country has been without an Executive since January when the power-sharing agreement collapsed. It is believed that an introduction of an Irish language is seen as one of the main issues and the reluctance of the DUP to agree to legislate for same-sex marriage.

On Monday a spokesman for the Prime Minister insisted the parties had “made progress” but that there “are still significant gaps which remain and we continue to work with them to overcome these”.

“You can expect James Brokenshire to update Parliament later this week on how that is progressing,” the spokesman added. “We continue to work with the parties on trying to overcome the difference between them and to restore devolved government, which is in the interests of all communities in Northern Ireland.”

Before talks began on Monday morning the DUP called on Mr Brokenshire to set a budget to ensure a ”measure of good government“ in the region.

The party said it would not accept “a bad agreement cobbled together to suddenly suit the timetables of others”.

“Our position has not changed, we want to see an executive set up - we would have done it March and sorted these issues in tandem,” said the party in a statement.

“Given Sinn Féin have dragged their feet over the last 10 months the secretary of state should bring forward a budget to bring a measure of good government to Northern Ireland,” the statement added.

The DUP said it will continue the discussions as it believes “devolution is best for Northern Ireland”.

But it warned that it would not be a part of a “bad agreement cobbled together to suddenly suit the timetables of others”.

Sinn Féin's Conor Murphy said while a deal can still be done it “needs to be a deal for all in our society and not just for the political leaderships of unionism”.

“If the political institutions are to be sustainable then they must be restored on the basis of equality, rights and respect.

“That requires an end to the DUP's denial of rights citizens enjoy everywhere else on these islands, language rights, marriage rights and the right to a coroner's court,” Mr Murphy added