Economy & Jobs Top Agenda

The €85m IMF/EU bailout for Ireland hangs like a bad winter snowstorm over the general election campaign.

There is no escaping it and people can talk about little else.

In most election campaigns, the economy is a central issue anyway.

But in this one, it is the only issue.

The strait-jacket which the IMF/EU deal represents for any future government leaves very little wriggle room for the parties in which to distinguish themselves.

There can be no major promises, because there is no money to pay for them, and the electorate knows that.

So the debate centers on how to clean up the mess, where the cuts must fall and who must pay.

In these circumstances, the only promise that offers any scope for maneuver is to renegotiate the bailout deal itself.

And that's what both the main opposition parties say they will attempt to do.

Fine Gael and Labour have pledged to renegotiate the terms of the €85bn IMF/EU bailout fund if they are elected to government, as opinion polls suggest they will.

Fine Gael says it will seek a reduction in the crippling 5.8% interest rate being charged on Ireland's loans, while the Labour Party wants to see more time given to Ireland to achieve its target of reducing debts to 3% of GDP by 2014/15.

Meanwhile, Sinn Fein and the United Left Alliance have said they will tell the IMF and EU that Ireland does not want their money.

Fianna Fail's Brian Lenihan, the finance minister who negotiated the deal, said the other parties were "unwilling to deal with reality".

And the president of the European Central Bank Jean Claude Trichet, has closed the door on any renegotiation of the deal.

Mr Trichet said that it is "absolutely essential" that Ireland sticks to the plan agreed by the outgoing government on behalf of the State in November.

But that hasn't stopped both Fine Gael and Labour from offering the prospect of new terms.

"The deal Fianna Fail struck with the EU and IMF which ties the hands of any future government will cripple the Irish economy," said Labour leader Eamon Gilmore.

"We will find ourselves in 2014 with people having to pay more taxes, more cuts in services, higher unemployment and we won't have recovery.

"We are confident that we can renegotiate it because the current deal is not going to work."

He said he wanted the Irish voters to give him a strong mandate.

"It's either Frankfurt's way or Labour's way," he said.

Enda Kenny, the FG leader, travelled to Brussels to meet European Commission

President Jose Manuel Barrasso to indicate he will be looking to renegotiate parts of the deal if he is Taoiseach.

The success of both parties could depend on how much the public believes they can achieve in any attempts to renegotiate.