Irish Defence Minister Simon Coveney has stated he expects a new Irish government later this week. Speaking on Sunday he stated, “I think we will have a Government this week. If you are asking me to guess I would probably say on Thursday.”

“We cannot be sure and it could even be Friday.”

"The public are very impatient at this stage. They have been waiting a long time for a Government. We have been working very hard, night and day, to make that happen."

Ireland has been without an elected government since February 26 when there was an inconclusive general election.

Now acting leader Enda Kenny looks set to become the first leader of his party ever to hold onto the job of Taoiseach for two consecutive elections. After agreeing to lead a minority government he needs to convince eight independents to vote with him which most observers believe he can achieve.

The toughest stumbling block, to get main opposition party Fianna Fail to agree not to bring down the government for at least a few years has been achieved.

Dáil Éireann, the main house of the Irish parliament, is due to meet again on Wednesday, and, although it seems unlikely to happen on that day, there is a widespread expectation that Kenny will shortly secure majority support in a vote to fill the office of Taoiseach, a position he currently holds in a caretaker capacity.

After protracted negotiations, agreement has been reached in principle between Fine Gael and their longtime political rivals, Fianna Fáil, whereby the latter party will abstain in the vote for Taoiseach. The deal is subject to formal approval by TDs and Senators of both parties at the start of this week but no serious difficulty is expected in this regard.

Kenny also needs to win the support of at least eight Independent TDs to be sure of a majority. Two Independents are backing him already and Fine Gael is in contact with others in the same non-party category with a view to achieving that objective. The Fine Gael leader's task will be made easier if the seven Labour TDs and two from the Green Party abstain in the vote.

Since Fine Gael has only 50 out of a total of 158 seats in the Dáil, the new government will be a minority administration, dependent mainly on abstention or support in key votes by Fianna Fáil, who will be the largest party in opposition, as well as the backing of sufficient Independents.

The most difficult issue in the talks between Fine Gael and Fianna Fáil was the future of the water charges imposed by the outgoing Fine Gael-Labour coalition.

Although the level of water charges had already been reduced to a $3.50 (€3) a week for most families, it continues to be a matter of major political controversy.

Far-left groups such as the Socialist Party and People Before Profit have taken a hard line of opposition to the charges and their stance has influenced Sinn Féin to strengthen its own stand on the issue.

In February's general election, the Fianna Fáil manifesto included a pledge to end the charges and abolish Irish Water, the company which was set up to manage the scheme.

This restricted the party's room to manoeuvre in the recent talks with Fine Gael. In the end, agreement was reached to set up an independent commission to conduct an investigation of the issue, with a parallel suspension of water charges for nine months.

The commission's report will then be discussed by a committee of TDs and it is understood that no charges will be collected while that Dáil committee is carrying out its deliberations, although this is subject to further clarification.

The deal between the two parties on water charges was denounced by outgoing Minister for the Environment, Alan Kelly, who has had responsibility in that area. He told the Dáil: "A suspension or scrapping of water charges will result in the loss of billions of euro of potential investment in water services. I believe we will have water shortages in this very city in the near future."

The Minister, who is a brother of Irish-American businessman Declan Kelly, recalled how his former party leader, Eamon Gilmore, once accused Fianna Fáil of economic treason and Mr Kelly added that " Today, Fianna Fáil is guilty of environmental treason".

Fianna Fáil also came in for criticism from outgoing Minister for Health, Dr Leo Varadkar. Although he was himself part of the Fine Gael negotiating team which agreed to the suspension of water charges, he said the demand was "wrong" and "not in the public interest".

In a move that augured badly for the stability of the inter-party arrangement, Dr Varadkar described Fianna Fáil's concentration on water charges during the talks as "a little bit surreal" and "ridiculous". He added: "It's the wrong thing to do; it's not in the public interest to do this."

There was angry reaction to his remarks from Fianna Fáil but that party's finance spokesman Michael McGrath, who was centrally involved in the talks, said they would not "throw the toys out of the pram" although the Minister's comments were "not helpful".

The Fine Gael-Fianna Fáil pact is scheduled to last for three annual budgets, i.e., till late 2018, at which time it will be subject to review.

Fianna Fáil is reported to be backing the Lansdowne Road Agreement, introduced under the outgoing government, for a gradual restoration of pay cuts imposed on public services.

There are also believed to be measures in the agreement for assisting people with mortgages or who live in rented accommodation and to reduce waiting-lists in the health service.