Britain faces a "difficult judgment" over whether to back Palestinian statehood at the United Nations, Nick Clegg said today amid reports of a coalition split on the issue.

The Deputy Prime Minister said there had been "debates" at the top of Government over the position to adopt but said it would be unhelpful to air them in public.

Diplomatic efforts are under way to persuade Palestinian President Mahmoud Abbas not to table a Security Council statehood bid - which is opposed by the US and Israel.

Israeli Prime Minister Benjamin Netanyahu has offered fresh talks in a bid to find another means to revive the peace process which has been stalled for more than a year.

The White House has signalled it would veto the move, raising fears of a tense showdown as senior politicians gather in New York for the UN General Assembly meeting.

Mr Clegg, said by The Times to be pushing for firmer support for the move against a more reluctant Prime Minister David Cameron, said the consequences of inaction had to be properly considered.

"We have debates, of course we do, in Government," he told BBC News from Birmingham where the Liberal Democrats are holding their autumn conference.

"The senior members of the Government on an issue like this - the Foreign Secretary, the Prime Minister and myself - we talk about this a lot.

"But we do it as a Government. I do not think it helps at all on issues like that for there to be a running commentary on who says what."

He went on: "It is a difficult judgment to make because we all want, of course, Palestinian statehood as part of a two-state solution.

"The Palestinian leadership says that they want to go to the United Nations and the judgment the world needs to make is: given that the Israeli government is very, very hostile to that, that's one factor, but equally you want to make sure that the inaction, if that's what occurs, of the international community does not isolate moderates in the Palestinian community, without whom there will be no peace agreement at all."

Foreign Secretary William Hague is at the UN gathering today, where he will join world leaders at the first formal meeting of the Friends of Libya.

Speaking about the Palestinian situation, he said the "only real way forward" was to press for a return to the negotiating table.

"The consequences of failing to arrive at a two-state solution could be catastrophic for the Middle East and the wider world, so we have to keep trying."

Representatives from around 60 countries will join Mustafa Abdul Jalil, chairman of the National Transitional Council (NTC) interim government, at the Libya discussions.

Leaders are expected to reaffirm their unanimous support for the NTC and pledge to continue working with the organisation in the wake of the collapse of Muammar Gaddafi's brutal regime.