Brexit negotiations have not begun promisingly and Cabinet divisions mean it is hard for the Government to have a clear position, a former head of the diplomatic service has said.
Sir Simon Fraser, who was the chief mandarin at the Foreign Office until 2015, said the UK side had been "a bit absent" from the formal negotiations in Brussels.
He said transitional arrangements covering the period after the UK leaves the European Union in March 2019 would be vital because there is "no way" that a deal on the future relationship with the bloc will have been finalised by then.
Sir Simon, who now advises businesses on Brexit and foreign policy, said: "The negotiations have only just begun, I don't think they have begun particularly promisingly, frankly, on the British side.
"We haven't put forward a lot because, as we know, there are differences within the Cabinet about the sort of Brexit that we are heading for and until those differences are further resolved I think it's very difficult for us to have a clear position."
The Government is reportedly set to publish further "position papers" setting out its views on customs arrangements and the Northern Irish border in the coming weeks, and Sir Simon said that would help demonstrate the UK team led by David Davis is "ready to engage".
"I think so far we haven't put much on the table apart from something on the status of nationals, so we are a bit absent from the formal negotiation," he told BBC Radio 4's Westminster Hour.
"I think we need to demonstrate that we are ready to engage on the substance so that people can understand what is really at stake here and what the options are."
One of the key issues that needs to be resolved in the talks with European Union chief negotiator Michel Barnier's team is the amount the UK will be asked to pay in a financial settlement.
Some Tory Eurosceptics have insisted the UK should not pay a so-called divorce bill following suggestions the Government could be prepared to offer Brussels £36 billion as part of a Brexit deal.
The Sunday Telegraph reported that the Government will only agree to pay the sum if the EU treats it as part of a deal on future relations.
The EU's stance is that trade talks cannot begin until significant progress has been made on the financial settlement, citizens' rights and Northern Ireland.
A senior Government source told the Press Association that "no such figure has been agreed" while another Whitehall source said it was "speculation".
North West Hampshire's Tory MP Kit Malthouse said: "The principle of an ethical separation, where we do recognise some ongoing obligations so that this isn't a sudden departure - we say 'we want to make it as easy on you as it will be on us, so let's reach an arrangement' - I think that's broadly accepted."
Any settlement would take account of financial commitments and ongoing liabilities such as pensions, along with paying to remain in initiatives such as the Horizon 2020 research programme.
But he told the Westminster Hour it was "weird" for Brussels to ask for cash to agree a trade deal: "They seem to say 'well, if you want free trade you'll have to pay for it' - well then, it's not free trade."
Conservative MP Peter Bone said a Brexit fee of £36 billion was unlikely to get through Parliament - and suggested Brussels should be paying the UK instead.
He said: "One of the prime reasons the UK voted to leave the EU was to stop sending them billions of pounds per year, so it would be totally bizarre to give the EU any money, let alone £36 billion, given also that over the years that we have been in the EU or its predecessor we have given them, net, over £200 billion.
"So if there was going to be any transfer of money then it should be from the EU to the UK."
Jacob Rees-Mogg, Conservative MP for North East Somerset, said: "There is no logic to this figure, legally we owe nothing."