Image caption Stephen Farry said there is potential for a deal to be done by Christmas

Alliance MLA Stephen Farry has said there is potential for a deal to be done by the Stormont parties before Christmas.

The talks concern disputes on flags, parades, the legacy of the Troubles and welfare reform.

The employment minister warned any deal must be all inclusive and not just be on corporation tax and welfare reform.

Speaking on the Sunday Politics programme, Mr Farry said there was a lot of work still to be done.

"You have to have a comprehensive agreement. Simply just picking off one or two issues and banking the progress and still having a lot of tension in the system next year isn't going to help us," he said.

"Relationships have deteriorated a lot over the past number of years.

"We have to start building trust and partnership between all the parties on the executive - without that we're simply just kicking the can down the road and I don't think that's in anyone's interest."

Image copyright AP Image caption David Cameron and Enda Kenny are expected to attend intensified talks in Belfast this week

Prime Minister David Cameron and Taoiseach Enda Kenny are expected in Belfast this week in an attempt to broker a solution.

'Significant progress'

Finance Minister Simon Hamilton told the BBC's Inside Business programme that both prime ministers must be "properly engaged" in the talks for a deal to be reached.

The DUP MLA said all the five parties had to made "significant progress" between now and Christmas.

Chancellor George Osborne has said devolving corporation tax powers to Stormont would depend on the outcome of the talks.

Unlike the rest of the UK, reductions to the welfare budget have not been implemented in Northern Ireland.

Sinn Féin remains resolutely opposed to introducing the cuts, while the DUP maintains that the consequent reduction in Northern Ireland's block grant means that there is no choice. The shortfall is estimated at £200m.

A previous effort to find new mechanisms to deal with the flying of flags, parades, and the legacy of the conflict ended without agreement last Christmas.