Britain is to step up the pressure on Iceland this week after voters there resoundingly rejected a plan to repay £2.3billion following the collapse of its top banks.

With around half of the ballot counted yesterday, 93 per cent had voted 'no' over whether to repay the billions owing to both Britain and Holland.

About 400,000 savers had deposits with online savings bank Icesave and were compensated by the two governments.