Villa are still challenging for a UEFA Cup spot going into the final weekend of the campaign despite having the smallest squad in the Premier League.

But O'Neill is aware they cannot afford to stand still and need to invest in new blood for the 2008-2009 campaign.

The former Celtic boss said: "I want to really keep the progress going. We want to try and step forward again and we're looking to add that extra quality to the quality that we have.

"We definitely need more. That gets harder as you go along because you're trying to add to a better side.

"But we're trying to progress and we have got to do it otherwise we wouldn't just stand still, we would probably regress. There's no standing still in Premier League football because there's always someone looking over your shoulder.

"Look at the sides next season that have got this driving ambition. Tottenham Hotspur have just spent £16-18million on a young kid (Modric) who has never sampled the Premier League!

"He looks a really good player so they're showing their intentions.

"Newcastle will want to compete and Sunderland are averaging 43,000 gates so it's going to be even tougher next year.

"Being back in the Premier League and having had two seasons to look at it, I believe that for us now to compete we have to add to what we've got."

But O'Neill conceded that keeping skipper Gareth Barry at Villa - a major target for Liverpool - would be the main priority this summer.

He said: "Trying to keep Gareth Barry at the football club will be the most important thing that we're trying to do in the summertime.

"A player of Gareth's undoubted quality and ability would take some replacing so keeping him at Aston Villa is as important as anything we do in the transfer market."