Labour to enter coalition talks with Fianna Fail

IN A COMPLETE reversal of the last two weeks of tentative contacts, talks are being arranged on a possible Irish coalition government comprising Labour and Fianna Fail.

The initiative has left a question mark over the embryonic left-right 'rainbow' coalition which John Bruton, leader of the centre-right Fine Gael party, has been trying to form with Labour and the Progressive Democrats. But Labour is continuing contacts with a view to three-way talks with those parties.

Fianna Fail's intervention follows its enthusiastic response to a document given to all parties by Labour after its discussions on a common left-wing programme with the formerly Marxist Democratic Left. The Fianna Fail move may also be aimed at preserving the leadership of Albert Reynolds, who is coming under increasing pressure to step down after the party's election setbacks.

Labour is deeply wary of entering any alliance with the radical right Progressive Democrats, and has tried to push Fine Gael towards a left-leaning coalition involving the Democratic Left. But both Fine Gael and the PDs have repeatedly ruled out any role for the hard-left party.

By contrast, Fianna Fail stressed it was laying down no preconditions, a stance that has offered hope for Labour's avowed aim that its leader, Dick Spring, should become Taoiseach for at least part of the next government.

Fianna Fail's carefully tailored response echoed many aspects of the common left programme as if to suggest an alliance with Mr Reynolds could be more amenable to social democratic strategy than one led by Fine Gael.

It also leaves open the possibility that the Democratic Left could join the government.

Mr Reynolds's proposals, given to Labour just before he left for the European Community summit in Edinburgh, offered them several appealing carrots.

Fianna Fail says a partnership government would inevitably be different to a traditional coalition of 'one large and one small party'. This implied that it would treat Labour with more respect than it had the Progressive Democrats during their stormy cohabitation since 1989.

Other sweeteners included a flexible attitude to public borrowing, and a commitment to new equity for troubled state firms such as the national airline, Aer Lingus.

But there are significant hurdles to be cleared before Labour agrees to join its first ever alliance with Fianna Fail. Labour's deputy leader, Ruari Quinn, emphasised that his party still has reservations about the 'culture' of Fianna Fail, interpreted widely as a reference to Mr Reynolds's leadership.

Last night, Fine Gael indicated that it wanted Labour's talks with Fianna Fail to be concluded before it would resume its own coalition negotiations.