The Government should stop MLAs' salaries and expenses if the parties can't reach a deal within three months, a member of the panel that set Stormont pay has declared.

Former PSNI Assistant Chief Constable Alan McQuillan, who sat on the Independent Financial Review Panel (IFRP), last night said there would be public fury if politicians continued to be paid indefinitely in the absence of a working Executive.

"The political vacuum means that jobs and public services are under threat in the wider community. For MLAs to continue merrily on full pay and expenses would anger people feeling the pain of the failure to reach a deal," he said.

"MLAs' salaries and expenses cost us £13.5m a year - that's about the same as the Renewable Heating Incentive is costing. The public want a functioning Executive but they don't want to pay for one that doesn't exist.

"They certainly don't want to see the politicians, who have caused the chaos, still getting rewarded handsomely."

Mr McQuillan was speaking as Secretary of State James Brokenshire ruled out calling a second election and said there remained "a short few weeks" to strike a deal.

The former senior policeman was one of three members of the now defunct IFRP that set MLAs' pay.

Mr McQuillan said that when devolution was suspended in 2002 MLAs continued to receive 70% of their salaries and expenses for the next five years. "No way should that be allowed to happen again," he insisted.

"The Secretary of State must set a timetable of three months to reach a deal and to stop MLAs' pay totally if there is no agreement."

Mr Brokenshire will today make a full statement to the House of Commons on the way forward for Northern Ireland after the collapse of talks plunged Stormont into even deeper crisis.

With the DUP and Sinn Fein blaming each other for the failure, the Secretary of State said there was still a window of opportunity to reach a deal.

However, there were few signs last night of any willingness to compromise by the two main parties. Yesterday's Assembly meeting was cancelled after it became clear that a government couldn't be formed by the 4pm deadline.

Without an Executive or agreed budget in place for the new financial year, control of Stormont's finances will now pass to David Sterling, the permanent secretary at the Department of Finance.

Mr Brokenshire said that while there had been progress in the talks on a "number of issues", there were "significant gaps between the parties" on culture and identity issues.

In a significant climbdown from his position in January, the Secretary of State, who has been accused of weak leadership, said there was no "appetite for any further immediate snap election. I believe there remains an overwhelming desire among the political parties and the public here for strong and stable devolved government".

But sources last night said that despite Mr Brokenshire's upbeat message, London was moving inexorably toward introducing emergency legislation next month to allow for a limited return to "soft" direct rule. Sinn Fein's Stormont leader Michelle O'Neill blamed the UK Government and the DUP for the political logjam.

"We came at the negotiations with the right attitude, wanting to make the institutions work, wanting to deliver for all citizens. Unfortunately, the DUP maintained their position in relation to blocking equality," she said.

"The British Government is a player and part of the problem.

"Their approach in the talks meant that no agreement was possible. James Brokenshire cannot wash (his) hands of responsibilities and obligations to implement the commitments made in previous agreements."

But DUP leader Arlene Foster insisted Sinn Fein's "inflexible" approach to the talks was to blame for their failure.

"We wonder whether Sinn Fein were serious about reaching agreement at this time," she said.

"We are disappointed that Sinn Fein did not come to the talks in the same spirit as we came to the talks.

"The government of Northern Ireland is not a game, it is actually very serious and the fact we do not have an Executive being formed today is very regrettable."

Ulster Unionist chief negotiator Tom Elliott rounded on both the DUP and Sinn Fein for "this shambolic process", and also accused Mr Brokenshire of weakness.

"The DUP and Sinn Fein are incapable of doing a deal on their own, although that shouldn't surprise anyone," he said. "The Secretary of State was weak in letting the talks drift along and appears to have seen his role as a facilitator rather than as a convenor.

"He needs to take a grip of the situation which now confronts us and should not allow the largest parties to dictate the agenda or timing of progress."

SDLP leader Colum Eastwood called for "immediate refreshed dialogue" with an independent chairperson.

"Over the last few weeks we reached common ground on a number of key issues and closed gaps on others. Even on issues which seemed intractable, like Brexit, significant progress was possible," he said.

"We must all seek to occupy and expand that common ground, not see it scorched."

Alliance leader Naomi Long urged the parties to "get serious" and end the political drift. "There still exists an opportunity if people are committed to the talks," she said. "It is unthinkable a project made up of 25 years of hope, time and effort from many quarters could be thrown away so lightly."

TUV leader Jim Allister described proceedings at Stormont yesterday as "comical" and said it was time to "close this farce down".

Belfast Telegraph