Irish Prime Minister Cowen Will Consult on His Future as Criticism Mounts

Irish Prime Minister Brian Cowen plans to consult with colleagues on his position over the next two days amid mounting criticism of his leadership.

Fianna Fail lawmakers discussed his leadership in Dublin today, sparking speculation that he may face a challenge 2 1/2 years after succeeding Bertie Ahern as party leader.

Cowen “will take stock of his own position over the next few days,” lawmaker Noel O’Flynn told reporters after the meeting.

Cowen, who presided over Ireland’s 85 billion-euro ($113 billion) bailout last year, has been criticized this week by opponents over his contacts with former Anglo Irish Bank Corp. Chairman Sean Fitzpatrick two months before the government introduced its bank guarantee in September 2008. The party is at a record low in opinion polls before national elections due within three months.

Support for Fianna Fail plunged to 14 percent, according to a poll carried out this month. The largest opposition party, Fine Gael, is backed by 35 percent, the survey by Red C for Dublin-based bookmaker Paddy Power Plc showed.

Ireland agreed to a European Union-led bailout in November after losses at its banks became too big for the state to handle alone. The Irish yield premium over benchmark 10-year German bonds declined 5 basis points today to 526 points. It reached a record of 680 basis points on Nov. 30.

The opposition Sinn Fein party said today it proposed a motion of no confidence in Cowen as prime minister. Cowen had contact with Fitzpatrick in July 2008, including playing golf and having dinner, according to a book “The Fitzpatrick Tapes,” published on Jan. 9. In September that year, Ireland guaranteed the deposits and liabilities of all its banks. Cowen said yesterday in parliament there is “no question of inappropriate behavior.”

To contact the reporter responsible for this story: Finbarr Flynn at fflynn3@bloomberg.net; Joe Brennan at jbrennan29@bloomberg.net

To contact the editor responsible for this story: Colin Keatinge at ckeatinge@bloomberg.net.

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