A senior UK official said: “We imagine they’ll continue to talk through until Monday. We’ve made clear what will happen if they don’t reach agreement.”
A budget from Mr Brokenshire would bypass the Stormont assembly, which is not sitting due to the stand-off, and a draft does not include the £1bn funding package secured by Arlene Foster, the DUP leader, when she agreed to prop up Mrs May after the UK prime minister lost her parliamentary majority in June.
A budget imposed by London would simply execute the fiscal programme settled for Belfast before the DUP/Conservative deal, said two people with knowledge of the plan.
The “confidence and supply” deal agreed between the DUP and Mrs May’s Conservatives remains intact in Westminster. However, the £1bn of funding will only be released only if a power-sharing executive is restored or London imposes full-blown direct rule.
A spokesman for the Conservative party said their goal remained for the executive to be re-established, and for the £1bn funding to be provided.
But he added: “If it proves impossible for an executive to be formed, we have recognised in the confidence and supply agreement the need for additional funding to deal with Northern Ireland’s particular circumstances.”
Northern Ireland’s annual budget for day-to-day spending is about £10bn, with another £1bn for capital projects. Under the DUP deal with the Tories, the additional £1bn would be released over multiple years.
Mrs Foster has insisted in recent days that she is determined to achieve an agreement, and Gerry Adams, the Sinn Féin leader, said on Thursday that the only reason his party remains in talks “is to make them work”.