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Ireland prepared on Sunday to reshuffle the same big parties into a new government after a general election returned incumbents that have channelled record corporation tax receipts into higher spending.
Centrist party Fianna Fáil on Sunday evening appeared on track to win the largest number of seats and to continue the coalition with its conservative Fine Gael partner that has governed Ireland since 2020.
Together, the two parties that have dominated Irish politics for most of the past century are expected to secure close to the 88 seats in the Irish parliament needed to form a government. That sets the stage for negotiations with independents or small parties after their former junior coalition partner the Greens suffered an electoral collapse.
“The centre has held up in Irish politics,” said Paschal Donohoe, one of the most influential Fine Gael members of the outgoing government and head of the powerful EU group of Eurozone finance ministers.
Sinn Féin, the pro-Irish unity party that is the main opposition, insisted it had broken the traditional grip on Irish politics of Fianna Fáil and Fine Gael.
Sinn Féin won slightly under a fifth of first preference votes under Ireland’s proportional electoral system, just behind the other two, but has no firm allies to give it a credible path to government.
“The Irish people have voted for economic stability and protecting the progress that has been made,” said Jack Chambers, deputy leader of Fianna Fáil and finance minister.
Ireland has the luxury of an expected €24bn budget surplus this year thanks to a likely €30bn corporation tax haul from multinational tech and pharma companies with European headquarters or big plants in Ireland.
“The corporate tax boom explains a lot of this result,” said Aidan Regan, professor of political economy at University College Dublin. “The last two or three budgets have just been giving people lots of money, basically.”
However, Donald Trump’s threats to slash US corporation tax to match Ireland’s 15 per cent rate to try to reclaim some of the taxes paid by American companies abroad are a risk.
“Stability — both economically and politically — is vital at the moment,” Donohoe said. Fine Gael has been in office since 2011.
Turnout — at just below 60 per cent — was low. Early results showed support for Sinn Féin slipping compared with the last general election in 2020. Fianna Fáil and Fine Gael appeared to have lost less ground, though both were far below levels they commanded in the past.
“Parties that once collectively accounted for 80 per cent of the electorate are now pretty much stagnant on 40 per cent — and that’s with the economy firing and full employment and unprecedented [corporation] taxes,” said Lucinda Creighton, a former Fine Gael Europe minister.
“By coalescing, the two parties have resigned themselves to limping along together and hoping the opposition don’t get its act together . . . it’s governing by default.”
Mandy Johnston, a former Fianna Fáil government spokesperson, said: “People vote with their pocket — and that’s why you’re not seeing a huge shift. People are not willing to take a chance [on other parties]”.
Veteran gangster Gerry “The Monk” Hutch was in early contention for a seat in Donohoe’s constituency but lost after a nail-biting count.
Fianna Fáil and Fine Gael leaders were waiting for full results — expected early in the week — before considering coalition partners.
If Fianna Fáil is in pole position, it will expect its leader Micheál Martin to become Taoiseach, replacing incumbent Simon Harris of Fine Gael. Fine Gael wants to continue the previous arrangement, where the parties swapped the premiership halfway through parliament’s five-year term.
Donohoe said there was “a chance” a new coalition could be in place by Christmas, “but it’s going to take some time to get there”.