DUP seeks £2bn deal to support Conservatives

The Democratic Unionist Party has asked for significant investment in health and infrastructure in NI as part of a parliamentary deal with the Tory Party.

Negotiations began after the Tories failed to win an outright majority in the general election and needed DUP support for a minority government.

The news came as the State Opening of Parliament took place in London.

On Tuesday, the DUP expressed concern that it was being "taken for granted" in the discussions.

• Brexit bills at heart of Queen's Speech

The Tories insisted the negotiations were proceeding as planned.

Sources told the BBC on Wednesday the party wants to see £1bn investment in the health service in Northern Ireland and a similar figure for infrastructure projects.

The DUP has also focussed on key economic measures including a reduction of corporation tax and the scrapping of air passenger duty (APD).

The State Opening is one of Parliament's set-piece occasions

BBC News NI political correspondent Stephen Walker said: "Sources close to the talks process say the plans to scrap APD have "stirred much resistance within the Treasury.

"It is also understood the DUP has put forward plans for city deals for local councils in Northern Ireland, which will give local authorities greater economic powers.

"The party is also keen to see increases in defence spending, and wants to see Northern Ireland companies benefit from extra investment.

"The party has long campaigned for defence spending to be set at 2% of GDP, and increased budgets for the army, navy and air force have been raised in the discussions with Number 10."

The State Opening is one of Parliament's set-piece occasions, when the Queen outlines the government's legislative plans.

The economy, moves to create a fairer society and Brexit are expected to dominate the Queen's Speech, which will cover a two-year period instead of one.

The DUP is expected to back the Queen's Speech when MPs vote on it next week.

The talks between the DUP and the Conservatives about forming a parliamentary agreement have generally been upbeat, but on Tuesday there was a change in mood.

A DUP source complained the discussions needed "greater focus".

A dressed-down Queen's Speech

• The Queen arrived at Parliament in a car, rather than horse-drawn carriage

• There was no royal procession into the House of Lords chamber and the Queen wore "day dress" rather than robes

• Her crown was driven to the Lords in its own car, but she wore a hat instead

• It was the first state opening with "reduced ceremonial elements" since 1974

• This was agreed because of timing issues caused by the snap election - rehearsals clashed with Saturday's Trooping the Colour event

In a clear reference to the Brexit talks, the same source asked if Theresa May could not negotiate a deal with the DUP, "what does that mean for bigger negotiations she is involved in?"

Earlier, First Secretary of State Damian Green said that while it was "possible" the Conservatives and the DUP would not be able to agree a deal, the talks were "progressing well" and were being conducted in a "constructive spirit".

He went on to tell Radio 4's Today programme that the parties had some differences, but also "a lot in common".

"We are both unionist parties at our heart, we are both very concerned with combating terrorism, we both have similar views about delivering a good Brexit for this country and obviously we are very concerned with the Irish border issue," he said.

"All talks of this kind take a long time."

Former DUP special adviser Richard Bullick said he was surprised a deal had not yet been agreed.

'Pretty extraordinary'

"I do find it pretty extraordinary that two parties that have quite a bit in common, seem to have a broadly similar agenda, haven't managed to get a deal hammered down," he said.

"In the past one would have thought this could have been done in a matter of hours or a few days, but clearly that hasn't been possible.

"The DUP will not want to find themselves in a position the Liberal Democrats found themselves in after 2010, and will be making sure that, if and when a deal is done, it is a deal that is going to work for the DUP as well as the Conservatives."