`A ball of smoke . . . a load of lies . . . a lot of nonsense" . . Bertie Ahern almost spat out the sound-bites for the midday news as he stoutly defended himself and his Government from a rising tide of allegations from the past.

Exuding anger and determination as he confronted John Bruton and Ruairi Quinn over their demands for explanations arising from the latest Irish Times revelations, the Taoiseach promised to tell all in the afternoon.

Beside him, Mary Harney looked calm and confident. Like a person who thought she knew it all. And perhaps she did. Only the night before, the Progressive Democrats had been fully briefed on matters affecting Fianna Fail that were likely to "come down the track".

The Irish Times queries of the previous week, concerning monies paid to Fianna Fail from a passport account, had forearmed the Taoiseach and his advisers.

The fury of the initial response rocked the Opposition parties back on their heels. This wasn't going to be the soft touch they anticipated. By the time 3.30 p.m. came, they were walking softly and watching for Fianna Fail's big stick.

Even before that, the Taoiseach had gone public in Wexford to pour scorn on his political opponents and to ridicule the content of The Irish Times report. The money hadn't come from an investment account; it was a deposit account. The money hadn't been "diverted"; it had been "transferred". And it wasn't a donation; it was a loan.

It sounded suspiciously like the creative use of semantics. But if defining your terms allowed you to counter-attack, what politician could resist? By early afternoon, a full-blooded counter-attack was under way. Charlie McCreevy's advocacy of a buttoned-lip approach was temporarily discarded.

A scorched earth policy would be the response to any perceived assault on the integrity of the Coalition Government. Ruairi Quinn found himself in the frame when Fianna Fail quietly disclosed the Labour Party leader had himself made representations in favour of the American passport applicant in 1993 and 1994.

And Mr Ahern did a little coat-trailing when he suggested to the Opposition he could "go fairly well around the House here" if he disclosed murky details in all the files submitted to the Moriarty tribunals.

The suggestion brought John Bruton indignantly to his feet. He had nothing to hide. After a brief skirmish, Mr Ahern slipped away.

The set-piece Dail battle took the form of trench warfare, rather than the deployment of rapidly-moving armoured divisions. The format required the Opposition to make opening statements and allowed the Taoiseach the last word. A question-and-answer session was not allowed.

In opening, Mr Bruton laid blame for the controversy at the Taoiseach's own door. An official in his office confirmed the money paid to Fianna Fail came from a passport account, Mr Bruton said, which most reasonable people would understand as money paid for getting the passport.

He went on to inquire whether similar donations were made to Fianna Fail by other foreigners seeking Irish citizenship under the "murky" passport for sale scheme. But there was no reply forthcoming.

Forewarned about Fianna Fail's intentions to tie him to the matter, the Labour leader placed his own involvement, in seeking investment for a County Cork pottery, on the record. ail. Mr Quinn recalled the passport for sale scheme first came to public attention in 1994 when Labour was in government with Fianna Fail. At that time, it transpired that £1 million had been invested in a petfood company owned by the family of Albert Reynolds.

Labour had "accepted the Taoiseach's word that he had no knowledge of the investment or the granting of the passports, difficult as this was to believe, especially given that Deputy Reynolds had been at the material time a director of C&D Petfoods." Arising from that incident, the Labour Party insisted on the earliest possible enactment of the Ethics in Public Office Act.

Then Mr Ahern gave a carefully choreographed performance, providing new and irrelevant detail and carefully splitting hairs. It was done with style and vigour. But the performance wasn't as transparent as it appeared; nasty questions persisted.

The defence offered by the Taoiseach was that this money did not come from a passport for sale investment account, designed to create or protect jobs in this State. Rather it had come from a joint deposit account. And one of the joint account holders, Irish businessman Brian O'Carroll, had decided to make an interest free loan of £10,524.59 to Fianna Fail after being contacted by a member of the national executive.

It sounded simple. An American businessman and his wife had opened two investment accounts with the ICC in 1991 with the intention of obtaining an Irish passport.

A deposit account containing £10,000 had also been opened.

After that it got murky. The Taoiseach sought to differentiate between these "investment" accounts and a "deposit account", opened at the same time, over which Mr O'Carroll had "signing powers". What Mr Ahern did not tell the Dail was that Mr O'Carroll was acting, and had acted as a passport-getting agent in a number of other instances - including C&D petfood - for foreign nationals. He was assured by Mr O'Carroll it was not an investment account.

What is clear is that the bank accounts were opened in 1991 for a specific purpose. An interest-free loan, with a normal life-span of three years, was made to Fianna Fail in 1993 and has never been repaid. And the required passport was granted in 1994.

The distinction between a political donation and an indefinite, interest-free loan may be important. Mr O'Carroll is on record from 1997 as saying that while most foreigners might feel obliged to make political donations in return for an Irish passport, it had never happened as far as he was concerned. Such distinctions and niceties make the political and business world go around.