European Parliament president Antonio Tajani has described Britain's financial offer on Brexit as "peanuts" ahead of a crunch European Union summit this week.

Prime Minister Theresa May has promised to maintain Britain's contributions for two years after Brexit in March 2019 to complete the current EU budget period, totalling around 20 billion euros ($24 billion).

But Tajani told the BBC's Newsnight programme late Tuesday: "Twenty billion is peanuts. The problem is 50 or 60 (billion euros), this is the real situation."

Asked if May agreed her offer was "peanuts", a source from May's Downing Street office told reporters: "I suspect that she does not agree with that.

"We've made an open and generous offer," the source said.

Disagreement over the extent of Britain's financial liabilities is a major sticking point in the Brexit negotiations, which were due to move on to the next stage this month but are still deadlocked.

"The UK government is not realistic. We need to put the money on the table, we need our money back as Mrs Thatcher said 30 or 40 years ago," Tajani said.

He was referring to a demand in 1980 by former prime minister Margaret Thatcher to adjust Britain's contributions to Europe.

"Then it is possible to start the negotiations for the new deal," Tajani said.

EU leaders are meeting in Brussels on Thursday for a two-day summit in which they will decide what progress has been made in the first stage of negotiations on Britain's withdrawal.

London had hoped they would approve the start of talks on the future trading relationship between the two sides, but this is likely to be postponed until a December summit.

- 'A difficult negotiation' -

Brexit minister David Davis on Tuesday accused the EU of holding up divorce negotiations to get Britain to pay more money.

"They're using time pressure to see if they can get more money out of us -- it's obvious to anybody," he told MPs -- prompting a swift denial from Brussels.

Irish premier Leo Varadkar said the problem was that EU leaders were still unsure about what Britain wants, after weeks of public disagreements in May's cabinet.

"It is quite a difficult negotiation when people who want to leave the European Union in Britain don't really seem to agree among themselves what that actually means," he told the BBC's Spotlight programme late Tuesday.

He added: "It's still not clear what the UK actually wants in terms of a new relationship.

"Because on the one hand it seems that the UK wants to have a close trading relationship with Europe just like it has now, but it also seems to want something different.

"And it is very hard for us as European prime ministers to understand exactly what the UK wants the new relationship to look like."

Tajani added: "We (the EU) are united. I don't know where is the unity in the UK, because there are many different positions."

Source: AFP