"This would be a deal which would be nobody's ideal deal, and that includes ourselves," Prime Minister Tony Blair's spokesman told a news conference here Friday, "but let's see if we can reach a realistic deal."

"We don't believe the issues are going to get any easier," he said, adding that "this is the best chance to try and get a deal."

He said leaders of the 25-country bloc would meet again over lunch after a series of bilateral meetings during the morning, during which Blair met twice with French President Jacques Chirac and German Chancellor Angela Merkel.

The spokesman said Blair would use the lunchtime session to report back on the talks and "set out where we are."

"The issues are difficult. We have to adopt a very realistic approach," he added.

"We are prepared to pay our fair share of enlargement, but equally we have to recognise that the budget situation is tight."

Britain, which holds the EU presidency, is under strong pressure to draw up a new proposal including a further cut in its long-cherished budget rebate -- something Blair has said he can only agree to if there is a reform of the EU's generous farm subsidy system, which benefits French farmers the most.