The Prime Minister spoke to the European Council president Herman Van Rompuy and his Irish and Czech counterparts on the phone last night to try to work towards a deal on the EU budget.
A Number 10 spokesman said Mr Van Rompuy updated David Cameron on his discussions with other leaders.
The PM set out his view that EU spending cannot be discussed without reference to cuts back here in Britain.
Downing Street says he believes that Mr Van Rompuy is taking a step in the right direction, but believes further cuts can be made.
On the issue of the UK rebate, Number 10 confirmed it was in the proposals set out by the European Commission and revised by Van Rompuy, but he reiterated that it was not up for negotiation, adding: "We will protect our rebate. We think it's fully justified."