Fianna Fáil is dismissing Fine Gael threats of another election after government formation talks stalled, and is instead hinting the party may support a Dáil vote opposing water charges.

Fianna Fáil leader Micheál Martin yesterday predicted a deal for a minority government could be agreed early this week, despite both sides refusing to compromise on water charges. Fine Gael sources though, are pessimistic, and suggested talks might go through to next week.

Tomorrow will mark 60 days since the general election. Fine Gael’s national executive met on Saturday in Portlaoise, where preparations for a second election were briefly discussed.

However, reports that Fine Gael are openly being put on a war footing have angered Fianna Fáil figures, who also dismissed Green Party claims that they are “holding the country to ransom” over water.

Clare TD Timmy Dooley told the Irish Examiner: “Fine Gael are trying to frighten the horses. It’s unhelpful. We don’t want an election, no more than any other party does. But neither are we afraid of facing the people on our principles and stances.”

Negotiations stalled after Fine Gael refused on Friday to agree to Fianna Fáil’s demands for a five-year freeze on water bills. Talks broke off and Mr Martin and acting Taoiseach Enda Kenny have since held a number of conversations over the weekend, the latest by phone last night.

However, earlier yesterday Mr Martin signalled that a compromise may be just days away.

“The situation has to be resolved fairly soon. There will be further engagement. We will see what comes from that, but the positions are very clear. We would hope that we can bring about a resolution early next week,” he said at 1916 celebrations in Arbour Hill.

Acting Foreign Affairs Minister Charlie Flanagan told RTÉ an outside group could mediate between Fine Gael and Fianna Fáil.

Mr Flanagan reiterated Fine Gael’s position that the “principle of paying for [water] charges must remain”.

However, Fianna Fáil wants charges frozen for five years or for the Dáil and a special commission to examine the entire system.

The commission would include experts from abroad, water conservationists, and economists. Its findings would be referred to an Oireachtas committee.

Such a model would allow Fianna Fáil to claim it fulfilled election promises to “end” charges. A commission could also suggest charges be reintroduced once certain infrastructure is in place and therefore back Fine Gael’s position that water is paid for. The main problem is that neither side will agree on the issue of whether charges should be suspended.

Mr Flanagan said €110m had been collected in charges and it was against EU rules to stop the levy.

“This is complex, not easy, but we can move towards a compromise. But scrapping charges is not the answer.”

Newly elected Fianna Fáil TD Marc McSharry, though, warned that “time is getting short”.

He reiterated there was “no mandate in the Dáil” for water charges, given the majority of TDs wanted to scrap or freeze bills.

The Sligo TD also left a veiled threat about what Fianna Fáil might do when and if a cross-party Dáil vote is moved on water charges.

“If there isn’t compromise on this, the reality is it will have to be left to the will of Dáil Éireann,” he said. “It’s clear what will happen then. We won’t be voting against our own policy.”

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