New Irish PM takes the reins as head of coalition

Enda Kenny said 10 lawmakers from Fine Gael party would be in cabinet.

Dublin: Ireland’s Prime Minister Enda Kenny unveiled surprise choices in his new cabinet as he took the reins of power after a general election sparked by the country`s economic collapse.

Kenny, a 59-year-old former teacher, was elected on Wednesday by 117 votes to 27 by lawmakers in the Dail, or lower house of Parliament. He heads a coalition government of his centre-right Fine Gael party and centre-left Labour.

Topping the new government`s agenda is a tricky renegotiation of an EUR 85 billion (USD 115 billion) IMF-EU bailout package that Ireland was forced to accept last year after an economy once dubbed the "Celtic Tiger" fell apart.

In his maiden speech, Kenny told lawmakers he was "very mindful of the task" ahead of him in rebuilding the shattered economy.

"This current crisis is the darkest hour before the dawn," he said, adding that a "bright new day" had come.

"We do stand on the threshold of fundamental change, but there is equally another task, and that is the task of renewal," he said.

Kenny said 10 lawmakers from Fine Gael party would be in cabinet, with the other five ministers drawn from Labour.

A veteran of 30 years in Parliament, Fine Gael`s Michael Noonan, has been given the hot seat of finance minister with responsibility for budgets and taxes.

However, the task of overseeing the looming austerity measures and public sector job cuts will be undertaken by Labour`s Brendan Howlin, who will fill the newly-created position of public expenditure and reform minister.

Joan Burton, the Fine Gael deputy leader and finance spokeswoman, was widely expected to land the vital role, but has instead been given the job of social protection minister.

The Foreign Ministry will be headed by Eamon Gilmore, the Labour leader, who also becomes deputy prime minister.

One of the first actions of the new government was to reduce the pay of the Taoiseach, or prime minister, and his new cabinet by 6.6 percent.

A statement said that at its first meeting the government had decided to cut Kenny`s pay to EUR 200,000 (USD 278,100) a year and to reduce the salary of ministers to EUR 169,275 a year.

The government will have only a brief honeymoon as both parties made renegotiation of the bailout terms a key priority and they have little time to lose as they face their fellow eurozone leaders at a summit on Friday.

The government said Kenny would meet European Commission president Jose Manuel Barroso on Thursday, ahead of the summit.

With 76 seats for Fine Gael and 37 for Labour, the new coalition will have a huge majority in the 166-seat Dail.

The election redrew Ireland`s political map as voters punished Fianna Fail, the party of outgoing premier Brian Cowen, which had dominated Irish politics for 80 years but was blamed for the disastrous economic situation.

Fianna Fail won just 20 seats, down from the 78 it took in 2007.

Its demise came after Fianna Fail agreed a bailout with the European Union and the International Monetary Fund last November, which many Irish see as a humiliation.

The new coalition will face a more radical hard-left opposition after Sinn Fein almost tripled its seats to 14, while its president Gerry Adams enters the republic`s Parliament for the first time.

Among 19 independents and other lawmakers elected is a united left alliance group.

In order to "enhance international credibility”, the coalition will also stick to austerity targets for 2011-2012 set out in a four-year plan drawn up by the last government.

Ireland`s budget deficit reached an alarming 32 percent of GDP after a state bailout of the country`s banks, which had lent recklessly and fuelled an unsustainable property boom.

Bureau Report

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