EU leaders have arrived for a second day of summit talks, where the chances of securing a deal for the Union's next seven year budget still look uncertain.

Prime Minister David Cameron said he was doubtful about the progress so far and reiterated his concerns on EU spending.

Whilst Germany and the United Kingdom are demanding deeper cuts to the nearly one trillion euro budget, other countries including France and Poland are keen to preserve EU funding in areas such as agriculture and development funds for poorer regions. Angela Merkel speaking here doesn’t feel a definitive result has been reached either. She said:

"We had the opportunity to study the proposals of Mr. Van Rompuy last night. I believe that we won't get the unanimous decision we want in this round either. We will discuss this now. I have always said that it wouldn't be dramatic if today were only the first step, we will see in the next hours. I think the positions are still far apart and if we need a second round we will take the time to do it."

The UK is the most vocal of EU member states seeking cuts in the budget to match austerity programmes at home. Failure to agree on the budget would mean rolling over the 2013 budget into 2014 on a month-by-month basis, putting some long-term projects at risk - leaving the UK government with an even bigger EU budget than what it is saddled with now.

Written and presented by Ann Salter.