Ireland readies for elections

Ireland's political parties geared up yesterday in preparation for embattled Prime Minister Brian Cowen calling 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 totalling R143-billion over the next four years.

"The finance bill goes to the president for signing into law [today]," a government spokesman said. That will be the final formal hurdle for the bill, after the lower house of parliament passed it on Thursday.

Cowen has said that he will ask President Mary McAleese tomorrow to dissolve parliament, triggering a general election, probably on February 25, in which his centrist Fianna Fail party is expected to take a drubbing.

The beleaguered premier leads a minority government after a tumultuous week in which his ruling coalition fell apart when the Green Party pulled out in protest at a botched cabinet reshuffle.

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 a à67.5-billion EU and International Monetary Fund rescue package. Ireland is the second eurozone nation after Greece to ask for a rescue deal.

The finance bill passed by 30 votes to 20. The lower house had been on standby to be recalled for an emergency sitting if the senate had recommended changes to it.

But opposition leader Enda Kenny, of the centre-right Fine Gael, told the EU 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 the IMF, Dublin said it would raise taxes and cut costs to bring the deficit below 3% of GDP.

Cowen's woes mounted as two newspaper polls showed him heading for the worst election defeat in Irish history.