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Irish senate clears bailout bill ahead of election

Ireland's political parties geared up today for embattled Prime Minister Brian Cowen to call elections after the senate passed a key finance bill needed to meet the terms of an international bailout.

world Updated: Jan 30, 2011 09:32 IST

Ireland's political parties geared up on Sunday for embattled Prime Minister Brian Cowen to call elections after the senate passed a key finance bill needed to meet the terms of an international bailout.

The upper house of Parliament voted late on Saturday to approve the government's harsh austerity budget, which brings in tax and cost cutting measures worth 15 billion euros ($20 billion) over the next four years. "The finance bill now goes to the President for signing into law on Monday," a government spokesman said, in the final formal hurdle for the bill after the lower house of Parliament passed the legislation on Thursday.

Cowen has said he will seek the dissolution of Parliament from President Mary McAleese on Tuesday, triggering a general election expected on February 25, in which his centrist Fianna Fail party is expected to take a drubbing. The beleaguered premier leads a minority government following a tumultuous week in which his ruling coalition fell apart after the Green Party pulled out in protest at a botched cabinet reshuffle attempt.

The crisis forced Cowen to quit as leader of Fianna Fail and abandon plans for a March 11 election. The opposition insisted that he push through the finance bill to clear the way for elections or face a no-confidence vote.

Cowen's popularity has collapsed in recent months as the economy, once dubbed the "Celtic Tiger", slid to the verge of bankruptcy, forcing Dublin to seek the 67.5 billion euro European Union-International Monetary Fund rescue package. Ireland is the second eurozone nation after Greece to seek a rescue.

The finance bill passed by 30 votes to 20, state broadcaster RTE said. The lower house had been on standby to be recalled for an emergency sitting if the Senate recommended changes in the finance bill but there were none.

But opposition leader Enda Kenny of the centre-right Fine Gael party told the European Union on Friday that he would renegotiate the bailout if, as expected, he becomes the new Prime Minister. Under the conditions of the finance bill agreed with the EU and IMF, Dublin said it would hike taxes and cut costs to bring the deficit down below 3% of GDP.

Cowen's woes mounted as two polls for Sunday newspapers showed Fianna Fail -- long the Irish republic's traditional party of government -- heading for the worst ever electoral defeat. A MillwardBrown Lansdowne poll for the Sunday Independent and a Red C poll for the Sunday Business Post show the party far behind the expected next government, a coalition involving Fine Gael and the centre-left Labour party.

The Independent poll has Cowen's personal rating at 10% and dissatisfaction with the government at 95%, the highest ever. It shows Fine Gael at 34% (up four points since the last MillwardBrown Lansdowne poll in September), with Labour down 11 at 24% and Fianna Fail at 16% down six points.

In the Business Post poll Fine Gael is at 33% (down one point since the last Red C poll in December), Labour is at 21% (down two points) and Fianna Fail is 16% (down 1 point).

The Business Post said that if Fianna Fail get 16% in the election "it would see a massacre of its candidates and the party would be reduced to a small rump in the next Dail (parliament) of perhaps around 20 seats".

In the 2007 election Fianna Fail got 78 seats in the 166 seat house and the Business Post said the party was now, "by any standards, astonishingly unpopular". Cowen, who has held a series of portfolios including finance minister from 2004 to 2008, said on Friday he would consult over the weekend with his family and advisers about whether to continue in politics.

He has borne the brunt of public anger over Ireland's humiliating bailout request, which came after a banking crisis and property market meltdown pushed the country into a deep recession.