US Congressional negotiators on Tuesday ignored a White House veto threat and agreed to allocate 560 million dollars to fund an alternative engine for the F-35 fighter jet, sources close to the talks said.

President Barack Obama and Defense Secretary Robert Gates have opposed building a second F-35 Joint Strike Fighter (JSF) engine built by General Electric and British manufacturer Rolls-Royce, saying it would be too costly in the midst of the worst US recession in decades.

The White House Office of Management and Budget (OMB) has branded such an expenditure as "unnecessary" as the current engine has performed well in thousands of hours of test flights.

Obama's senior advisors would recommend a veto if the final bill would "seriously disrupt" the F-35 program, the OMB said in July. The president could veto the bill if the measure is given final approval in both chambers of Congress.

But the Obama administration had a more muted response on Tuesday and seemed to ease its pressure on lawmakers about the plans.

"If the final bill this year once again calls for further investment in a second engine, the (defense) department will carefully evaluate the impact of that before making a recommendation to the president about the legislation," Pentagon spokesman Geoff Morrell told AFP.

Morrell noted that Congress has been pushing for the alternate engine for years, "and we still do not believe that is in the best interest of the program or the taxpayer."

Several lawmakers, including Senate Armed Services Committee chairman Carl Levin and his counterpart in the House of Representatives, Ike Skelton -- both Democrats -- have backed the funding of a second engine, saying more competition is necessary.

Senator John McCain, the top Republican on Levin's panel, is opposed to the plan, saying it would amount to wasteful spending.

House and Senate negotiators are to meet again Wednesday to strike a compromise on the 2010 defense authorization bill and a vote in the full House is expected on Thursday.

Obama won a defense budget victory in July when lawmakers sided with the administration in agreeing to halt the production of new F-22 stealth fighters after a presidential veto threat.