Belgium's squabbling political parties failed to hammer out a coalition deal in weekend talks after more than 500 days without a government in the eurozone country, media reports said on Monday.
Socialist leader Elio Di Rupo, who is expected to head any new government and is leading the power-sharing talks among six parties, described the situation as "dramatic", according to the Belgian news agency Belga.
Negotiations on forming a new government have been dragging on for weeks but again ran into deadlock over budgetary differences between right and left-wing parties after they resumed on Sunday, local media reported.
Caretaker premier Yves Leterme and the European Commission have repeatedly called for a deal on a future budget that would bring the public deficit below three percent of gross domestic product by 2012 -- rather than the 4.6% now forecast.
The six parties from across the political spectrum are split over how to slice 11.3 billion euros ($15.3 billion) off the deficit next year and some 20 billion in all by 2015.