THE LABOUR PARTY has announced it is walking away from government formation talks with Fianna Fáil and Fine Gael, following a meeting of its parliamentary party today.

Party leader Ivana Bacik called the leaders of Fianna Fáil and Fine Gael to communicate the decision.

Labour leader Ivana Bacik said her assessment following talks with Fianna Fáil and Fine Gael is that the policy gap between her party and both Fianna Fáil and Fine Gael is such that it would not be possible to implement the policy priorities in Labour’s “ambitious and radical state-led manifesto for change”.

“Therefore, the appropriate course of action is not to enter negotiations for government formation.

“The Labour Party will be a significant force in the 34^th Dáil. With an expanded and revitalised parliamentary party, we will continue to constructively argue for the centre-left vision of Ireland that resonated with so many voters during the election campaign – and continue to build for our ambition to see a centre-left led government,” she concluded in a statement. 

Speaking to reporters this afternoon, Labour’s Ged Nash said the key issues of contention include the Labour’s view on the delivery of state-funded childcare, the establishment of a State construction company, which Fianna Fáil and Fine Gael were skeptical about.

The election of Verona Murphy further complicated coalition prospects, it was stated. 

The announcement today comes as little surprise to those in political circles, with the expectation now that the two larger parties are set to form a government with Independents. 

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Yesterday, Wexford TD Verona Murphy of the Regional Independent group was appointed as Ceann Comhairle after a receiving the backing of Fianna Fáil and Fine Gael. 

The government formation talks are finishing up today for the Christmas period but are due to resume on 6 January, it is understood.