EU reform deal 'out of reach at the moment'
A deal on reforming Britain's relationship with Brussels is "out of reach at the moment", it was claimed after marathon talks between David Cameron and EU leaders broke up in the early hours.
The Prime Minister held several "hard going" meetings with European Council president Donald Tusk and French president Francois Hollande before leaving at around 5.30am Brussels time (4.30am GMT).
Negotiations will continue over the course of Friday as Mr Cameron engages in a last-ditch bid to secure a deal which will allow him to call a referendum on British membership on June 23.
Energy Secretary Amber Rudd insisted it was "too early" to conclude that the final package will be a watered down version of the proposals on the table.
She told BBC Radio 4's Today programme: "What the Prime Minister has said is that we are making progress but the deal is out of reach at the moment."
Ms Rudd said: "I think it's too early to conclude that it's a watering down of the deal that was proposed two weeks ago.
"I think that because it wasn't the final deal, we haven't yet got the final deal, the Government hasn't been able to go out and say this is why it works, this is why it's in the UK's interests, good for us, good for our families, good for our businesses."
Once a deal has been secured the Government "can make the pitch to the people to say this is why it works," Ms Rudd said.
"We haven't been doing that yet," she added.
Downing Street said the talks had shown "some signs of progress" but there was "still a lot to do".
Mr Cameron made no comment as he left following hours of negotiations that also involved Czech prime minister Bohuslav Sobotka and Belgian PM Charles Michel.
Following a summit dinner that dragged on until 2.20am Brussels time, Mr Tusk said: "We have made some progress but a lot still remains to be done."
Number 10 said the Prime Minister then had two meetings overnight with Mr Tusk, while the pair were joined for a third discussion by Mr Hollande.
A Downing Street source said: "It's hard going. Some signs of progress but nothing yet agreed and still a lot to do.
"We expect the PM will have a further bilateral with Donald Tusk at 11.45."
Mr Cameron warned EU leaders on Thursday that he was ready to walk away from their summit in Brussels without a deal unless they gave ground on key British demands and provided him with a "credible" package he can sell to voters.
He urged fellow leaders to agree a new "live and let live" settlement which he said could resolve the "festering" problem of Britain's relationship with Europe for a generation.
But as the first session of talks broke up on Thursday evening, a Number 10 source said there was more work to do on key issues including migrant welfare, child benefit, relations with the eurozone, treaty change and a British exemption from the requirement for "ever-closer union".
The possibility remained that a summit described by Mr Tusk as "make or break" could end without a breakthrough, almost certainly delaying a referendum until after the summer.
Mr Cameron faced demands from other EU states for a "no second chance" agreement to pre-empt the possibility of a second referendum.
Belgium - backed by France - proposed that the summit conclusions should state that any deal agreed this week is final and Europe will not come back with an improved offer if Britain votes to leave the EU.
The move is designed to quash the idea, backed by some Eurosceptics and reportedly floated privately by London mayor Boris Johnson, that a Leave vote would give the UK leverage to extract further concessions from the EU before a second poll.
With the 28 EU leaders still far from consensus, Britain's line on key welfare measures appeared to be hardening.
It is understood the PM has set his face against calls from eastern Europe for cuts in child benefit for offspring living overseas to be imposed only on new migrants.
UK officials declined to comment on reports that the PM was asking for a proposed "emergency brake" on in-work welfare payments to EU migrants to last for seven years, with the option to extend it twice by a further three years to a total of 13.
Addressing fellow leaders at the start of the two-day summit, Mr Cameron said the question of Britain's relationship with the EU had been "allowed to fester for too long".
He told them he needed a package that would be "credible" with the British people and strong enough to persuade them to vote to remain in the EU.
The new arrangement on offer would be a "live and let live" settlement under which states which want to integrate further will be free to do so, while those which do not can rest assured their interests will be protected, he said.
Organisers had initially billed the final round-table leaders' discussion as "the English breakfast", but this later became "the English brunch" and by Friday morning was being described as the "English lunch". The shifting timetable may mean plans to hold a meeting of the Cabinet in London later slip.
Ukip leader Nigel Farage said EU leaders would make concessions but insisted the reforms would amount to little.
He told Today: "I simply cannot believe that at some point today Mr Cameron will not get some concessions out of these people because they must know that if Cameron is sent home totally humiliated, Brexit has got that little bit closer."