Sinn Fein and the DUP are due to resume crisis talks at Stormont today after being granted extra time by Northern Ireland Secretary of State James Brokenshire to try and restore the powersharing government.
The parties failed to reach a deal on Monday night to break the political deadlock, missing another deadline set by Mr Brokenshire.
They had been warned by the Northern Ireland Secretary that they had until Monday to produce a written agreement or he would be forced to legislate for a budget for the region at Westminster.
Although no agreement was reached on Monday night Mr Brokenshire said that the parties had made progress and he was therefore going to defer his decision to legislate for a budget.
In a statement he said: "The parties have made further progress during the course of today. They are making certain additional requests of the UK Government which we need to consider.
"In the light of this, I believe it is right to defer the assessment on whether to introduce legislation to Parliament this week to enable an Executive to be formed. The parties will recommence talks in the morning (Tuesday) and I will reassess the position (on Tuesday) night."
The Northern Ireland Executive collapsed in January and the region has been without a powersharing government since then.
Despite endless rounds of discussions, a deal to restore devolution has proved elusive, with the introduction of an Irish language act seen as the main issue.
Mr Brokenshire and Irish Foreign Affairs Minister Simon Coveney were in Belfast on Monday to try and help find a breakthrough to the political deadlock.
Sinn Fein's Gerry Adams and Mary Lou McDonald also joined their party's negotiating team at Stormont.
The parties remained at Stormont until 9pm attempting to find a way forward.
Throughout the day the DUP, Sinn Fein and the Irish and UK Governments stayed tight-lipped about any progress in the negotiations.
The region's smaller parties held a meeting earlier in the day to discuss the lack of openness and transparency in the talks.