Up to four employees of the Socialist Party may lose their jobs as a result of the decision by Clare Daly TD to leave the party.
Ms Daly resigned from the party on Friday saying it was time to concentrate on building up the United Left Alliance in the Dáil of which she remains a member.
The Socialist Party said the core issue in the resignation was Ms Daly's support for the Wexford TD Mick Wallace who has admitted making a false tax return.
However at a press conference this afternoon the party's one remaining TD Joe Higgins said he would be asking the relevant authorities to reduce his party leader's allowance to reflect the fact that Ms Daly was no longer a member of the party.
Mr Higgins told The Irish Times the decision would have implications for the jobs of up to four party workers whose employment is funded by the money. In the immediate future the party would seek to cover the costs itself, through fund raising and subscriptions, he said.
Mr Higgins added that the €120,000 paid to the Socialist Party compared to some €4.5m paid to Fine Gael, €3.3million paid to Labour and some €2.6million paid to Fianna Fáil . Figures for the larger parties included a number of allowances he said, but the Socialist Party had declined to accept an allowance for a Party Whip.
Mr Higgins paid tribute to Ms Daly's work record as a politician and political activist and said the party had tried to persuade her not to resign. He said the resignation was "unfortunate".
In a statement Ms Daly yesterday said she had "no intention of engaging in a public war of words with the Socialist Party leadership. I am proud of my record as a Socialist Party activist and public representative, as a shop steward representing Aer Lingus workers and a campaigner with people across Dublin North and beyond".
