British Airways cabin crew are to be balloted next week on whether to back a peace deal or support further strikes, potentially leaving passengers facing further travel disruption.

The industrial action threatens to plunge the airline into further financial trouble following a week of disruption due to the volcanic ash cloud crisis.

With hundreds of flights grounded, BA estimated it was losing £15 million to £20 million a day until its chief executive Willie Walsh took to the skies to put pressure on calls for the no-fly ban to be lifted.

Despite BA bosses and the union Unite “making considerable progress” during negotiations in the long-running industrial row, the parties are still arguing over two key points.

Union officials last night admitted that it was “a possibility” that further strike action could be taken by 12,000 flight attendants if negotiations broke down early next week. They stressed that was a last resort.

The two sides appear to be close to agreement on working conditions for workers, which was at the heart of last month's dispute, but they are now arguing over fallout from the strike.

It is understood the parties are rowing over the removal of travel perks for members who took part as well as 50 disciplinary cases against union members that stemmed from their participation.

"As has been stated many times, we cannot accept that people that participated in lawful and legal action are singled out and victimised," a union official said.

The local branch of Unite has since written to members saying that they will be asked to take part in a “consultative” ballot to be undertaken from Tuesday.

The online ballot of its members will run for five days. If there is a ballot and the deal is accepted, the bitter row will end, but a "No" vote will bring the threat of more strikes.

Members will then be asked to either “accept the deal or give notice for further strike dates”.

Any further strike before the May 6 election could be a disaster for Gordon Brown whose former advisor, Charlie Whelan is Unite’s political director.

Talks between the airline and Unite have been continuing since the series of strikes in a long-running row over jobs, pay and working practices.

BA told the City that the latest stoppage was costing it £5.5million a day, £1.5million less than the first strike. It caused chaos for passengers.

A letter, sent by the local Unite branch to members, stated: “Discussions are ongoing to try and find a settlement and this could potentially continue until next Tuesday.

“A proposal has been put forward by British Airways after discussions with Tony Woodley.”

There remained, however, “two main issues of contention”, which were “staff travel and the fifty plus disciplinary cases related to the industrial action which remain unresolved”.
Last night a spokesman for Unite admitted there was “a possibility” that strike action could occur. No discussion had been made, he said, on when any strike could occur.

“We hope to have resolve the negotiations,” he said.

“It will become clear over the early part of next week what action we will have to take.”

A BA spokeswoman said last night: “We are still in discussions.”

She said she was not aware of any “deadlines”. She would not disclose details on the negotiations.