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Shape of new Irish govt yet to emerge

Ireland's opposition parties have made big gains in a general election focussed on the country's economic woes, but the shape of the next government is hanging in the balance as counting continues for a second day on Sunday.

The Fine Gael party was leading the pack as voters angry about Ireland's battered economy ended the 80-year dominance of Fianna Fail.

"This was a democratic revolution at the ballot box," Fine Gael leader Enda Kenny told supporters Saturday night.

By Sunday noon, 60 seats had been won by Fine Gael, 32 by Labour, 14 by Fianna Fail, 13 by Sinn Fein and 14 by smaller parties and independents. It takes 83 seats for a majority in the Dail, the lower house of the parliament.

Ireland's complicated proportional representation system produced extended suspense in the remaining races. Eamon O Cuiv of Fianna Fail, for instance, clinched his re-election on the eighth round of counting in the Galway West constituency, and Labour's Gerald Nash secured his seat in the 12th count in Louth.

Fine Gael was widely expected to form a coalition government with Labour. But with Fine Gael sensing that it might win nearly 80 seats, party leaders also talked about forming alliances with independent candidates. Kenny, destined to become prime minister, pledged to move quickly to form a government.

"We stand on the brink of fundamental change in how we regard ourselves, in how we regard our economy, and in how we regard our society," Kenny said.

Fine Gael polled 36.1 percent support with the first round of counting completed in all 43 constituencies. Labour, Fine Gael's possible coalition partner, was running second at 19 percent while Fianna Fail polled a historic low of 17 percent.

The Green Party, which had six seats in the Dail and was Fianna Fail's junior partner in government, lost all its seats.

Sinn Fein president Gerry Adams, who resigned his seat in the British parliament to run for the Dail, was among the winners.

Irish voters punished Fianna Fail for 13 percent unemployment, tax hikes, wage cuts and a humiliating bailout that Ireland had to accept from the European Union and the International Monetary Fund. In elections going back to 1932, Fianna Fail had never won less than 39 percent of the vote and had always been the largest party in the Dail.

Fine Gael ("tribe of the Irish") and Fianna Fail ("soldiers of destiny") were born from opposing sides in Ireland's civil war of the 1920s, and many see little difference between them on the issues. Fianna Fail, however, was leading the government when the property boom collapsed in 2007, and it put taxpayers on the hook to bail out Ireland's failing banks.

Brian Cowen, the outgoing prime minister, had fallen to record low popularity and resigned as Fianna Fail party leader even before the campaign. He had wanted to hold the election in March, but agreed to hold it early in a deal to win confirmation of the hated EU-IMF bailout.

"Fianna Fail will come back," said new party leader Micheal Martin, who bucked the tide to hold his seat.

The new government, like the last, will be constrained by the terms negotiated for the euro67.5 billion ($92 billion) credit line from the European Central Bank and the IMF. The loan is contingent on Ireland cutting euro15 billion ($20.6 billion) from its deficit spending over the coming four years and imposing the harshest cuts this year.

Kenny has pledged to try to negotiate easier terms for repaying the loan. He has also promised to create 100,000 new jobs in five years and to make holders of senior bonds in Ireland's nationalized banks shoulder some of the losses.

Fine Gael said it would seek to balance public finances mainly through cuts, not tax hikes; it would also reform the health service and abolish 150 public bodies.