Labour TDs and senators have rallied around Minister for the Environment Alan Kelly who is still involved in a dispute with Minister for Finance Michael Noonan over the Coalition's approach to easing the State's housing crisis.

The disagreement between the ministers meant the Government was unable to announce a comprehensive housing package in the budget.

Officials from the Department of the Taoiseach are expected to meet colleagues from the Department of Finance and the Department of the Environment in the coming days to try to find a resolution to the row. Taoiseach Enda Kenny is understood eager to see the public disagreement come to an end.

At a parliamentary party meeting last night, Labour politicians rallied around Mr Kelly, the party’s deputy leader. They are backing his plans to introduce rent certainty measures, which would see rents linked to the Consumer Price Index. Mr Noonan is opposed to such an approach.

A Labour source said party members are strongly supportive of Mr Kelly’s proposals on the subject.

“Labour firmly believes rent certainty is the right thing to do,” a source said. “It is critical that we deliver on the promise to bring rent certainty to the private rented sector.”

Mr Kelly has described Fine Gael’s plans to deal with the housing crisis as being “tokenistic” and “insufficient to deal with family homelessness”.

The proposed rent certainty package, a reduction to development levies and proposed grants for developers were not included in the budget announcement on Tuesday despite a series of meetings between the two Ministers’ departments last week.

Fine Gael insiders have alleged that Mr Kelly's housing plans are "barely economically viable". Their counterparts in Labour have accused Fine Gael of offering "tokenistic, cosmetic" proposals.

Taoiseach Enda Kenny has insisted interference in the rental market is not an option for the Government.

“It is very clear that interference in the market to its detriment is not something we should do,” Mr Kenny said.

“While people are calling for what they call clarity in respect of certainty for rent, if you interfere in the wrong way you make matters worse.’’

Mr Kenny told the Dáil Mr Kelly was “working very hard’’ on housing proposals.

“Believe me, I have a frustration about the fact this is not moving the way one would want,’’ he added.

Speaking yesterday, Mr Noonan insisted an agreement could be reached between the two parties.

“There are conversations ongoing between my officials and the officials in the Department of the Environment,” he said.

“We all realise that there’s a problem in housing and in rent particularly in Dublin and we’re trying to come up with additional solutions.”

He said Nama would provide 20,000 houses, including 2,000 social houses, between now and 2020, and he hoped the private sector would also contribute.

“But more needs to be done and we’re working it out between us.”

Asked if it was the case that Fine Gael had adopted a cool approach to rent certainty, as Labour sources have claimed, Mr Noonan said: “When we have a package we’ll announce it and you can take the temperature of it”.