Talks between Fine Gael and Fianna Fáil ended last night with no progress on how long a suspension of water charges should last, leaving the efforts to agree a deal on the formation of a minority Fine Gael-led government deadlocked.

Senior figures on both sides are pessimistic about the chances of a deal, though further talks are scheduled this morning.

Sixty days after the general election, the Dáil meets again today, but with the formation of government no nearer than it was before the weekend.

Fine Gael has offered a temporary cessation of water charges but insists that Fianna Fáil commit to reintroducing water charges if a proposed commission recommends it.

However, Fianna Fáil has refused to budge on its position it will not support or facilitate water charges during the lifetime of the present Dáil.

Frank exchange

Fine Gael is understood to have proposed a suspension of charges for six to nine months.

However, after a frank exchange, Fianna Fáil insisted it remained committed to its manifesto position, which proposes the suspension of the levies for five years. Fine Gael has requested that Fianna Fáil table a compromise position at a meeting this morning.

Fianna Fáil sources said they tabled a series of alternatives including the establishment of an Oireachtas committee to examine the recommendations of the independent commission.

Fine Gael sought a commitment from Fianna Fáil it would agree to implement the commission’s findings. However, Fianna Fáil rejected the proposal, insisting this was “undemocratic” and the Oireachtas should have its say.

Expressed concern

Fine Gael TDs expressed concern any suspension of water charges should be for no more than a few months. Several TDs suggested they were concerned that, if the charges are suspended, people who have paid should not be disadvantaged. Those who did not pay should be pursued for the unpaid amounts, TDs said.

Others warned agreeing to Fianna Fáil’s terms would be seen by voters as trying to hold on to power “at all costs”.

Meanwhile, a new Department of Finance forecast finds the next government may have some €700 million at its disposal for tax and spending measures in the 2017 budget, about €200 million more than estimated. The 2016 budget assumed €500 million would available next year.