LONDON • British and Irish ministers have played down hopes of a breakthrough in Brexit talks at an EU summit next week, suggesting it would take until next month to clinch a divorce deal.

European Union leaders have demanded real progress by the Oct 18 meeting to allow time for any deal to be approved by the bloc's Parliaments before Britain leaves next March.

British Brexit Secretary Dominic Raab told MPs that this month's meeting "will be an important milestone, we expect that to be a moment where we will make some progress".

But on actually getting a deal, he said: "We've always been clear we would aim for the October council, but there would be leeway, that it might slip into November. We're still clear on that."

Mr Raab declined to say when London would publish its updated plan on how to keep open the border between British Northern Ireland and EU member Ireland, a key sticking point in the talks.

In Dublin, where the Irish government unveiled a €1.5 billion (S$2.4 billion) "rainy day fund" to cushion the country from major economic shock due to Brexit, Foreign Minister Simon Coveney also looked to next month.

Negotiations had "intensified significantly this week" on trying to resolve the Irish issue, he said.

But he added: "I suspect November will probably be needed as well as October to get agreement on that."

EU leaders have held out the possibility of a special November summit to seal the overall divorce deal, but only if there is progress before then.

Diplomatic sources in Brussels said the EU no longer expects a new proposal from Britain for the Ireland-UK border fix.

That marked a small step forward in the Brexit talks even as negotiators from both sides - Ms Sabine Weyand for the EU and Mr Oliver Robbins for Britain - were locked in Brussels this week in what one diplomat described as "tunnel negotiations" to narrow down the outstanding differences.

Britain has rejected the EU proposal that Northern Ireland stay aligned to the bloc's Customs and regulatory rules, saying this would effectively carve off the province from the rest of Britain.

But it has yet to publish its own alternative, offering only a partial plan to keep the whole of Britain aligned with EU rules for a limited time.

The issue is particularly sensitive for Prime Minister Theresa May because her majority in the House of Commons depends on the support of a small Northern Irish party, the Democratic Unionist Party.

Meanwhile, The Times newspaper, citing unidentified lawmakers, reported that around 30 to 40 lawmakers from the opposition Labour Party would be prepared to back the Brexit deal that Mrs May is trying to strike with the EU.