A suggestion by Tánaiste Leo Varadkar that Paschal Donohoe could remain as president of the Eurogroup if he becomes minister for public expenditure after the December Coalition reshuffle has been greeted coolly by Fianna Fáil as tensions grow over the issue at the heart of Government.
Mr Varadkar said he had not discussed the issue with the Taoiseach Micheál Martin and Green Party leader Eamon Ryan as it was “not a priority” at present, but Fianna Fáil sources complained that Mr Varadkar was seeking to negotiate with them in public.
“There will be no negotiation,” said one senior Fianna Fáil figure, who believed the stance on the issue was hardening in the party.
Mr Donohoe heads the Eurogroup, the group of finance ministers from euro zone countries, but can only seek a second term if he is Ireland’s member on the group. He would be expected to relinquish the position if he ceases to be Minister for Finance.
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Under the Coalition agreement, when the Taoiseach’s position rotates to Fine Gael in December, the job of minister for finance switches to Fianna Fáil. Michael McGrath, currently Minister for Public Expenditure, is widely expected to be appointed.
However, there has been speculation, including from Mr Varadkar, that Mr Donohoe could retain the Eurogroup position if he were to become minister for public expenditure. EU sources were lukewarm on this possibility, however, and in any case it would require Fianna Fáil to agree that their minister for finance did not attend the Eurogroup. Party sources said that was a remote possibility.
EU sources say that Ireland needs to make a decision on its nominee to the Eurogroup soon, as if Mr Donohoe is not going to stand for a second term, he will need to inform colleagues soon to enable a process to pick a successor to commence.
Spokesmen for the Taoiseach and Tánaiste declined to discuss any agreement between the parties about jobs in Government. While the rotation of the Taoiseach’s office is written into the programme for government, other positions are subject to unwritten understandings between the leaders.
Mr Varadkar said on Wednesday that there will be a lot of speculation about the reshuffle but that there has been no discussions with Mr Martin or Mr Ryan yet as it is not a priority for now.
“My priority is getting the budget right and helping people with the cost of living and helping businesses to survive this winter,” he said, adding that it would be discussed in November or December. “I appreciate it’s of great interest to people in the political and media bubble.”
The Tánaiste said it would “unfortunately” not be possible for Mr McGrath to inherit the Eurogroup job from Mr Donohoe as it is elected by the other minsters for finance.
Mr Varadkar said the fact that an Irish person holds the position of Eurogroup president “is of benefit to Ireland”, citing an international deal on corporation tax as an example. “The fact that the person speaking on behalf of the euro zone was a Minister in the Irish Government really was very useful and helped us to craft those proposals in a way that protected our interests.”
He added: “I think 10 or 11 years ago, when decisions were being made about bank guarantees and bank bailouts and burning bondholders and all that, it’s a real shame that the president of the [Eurogroup] at the time wasn’t an Irish person.”
Mr Varadkar said he did not know it would be possible for Mr Donohoe to stay on as Eurogroup president while Mr McGrath attended meetings as minister for finance.
