Fine Gael has made fresh overtures to the Labour Party in recent days with a view to persuading it to consider participation in the next government.
Labour ruled out playing a role after its disastrous general election result, but some senior party figures now believe it should reconsider.
They have begun to speak to their colleagues about Labour’s options.
“There is at least a conversation about it now,” said one source.
The Irish Times has learned that acting Taoiseach Enda Kenny has held a number of meetings with the Labour leader, acting Tánaiste Joan Burton, and will meet her again tomorrow morning before the Dáil reconvenes.
Senior officials in both parties also held discussions yesterday.
Fine Gael has stressed that its discussions with the Independents are producing a draft programme for government that is much more centrist and “Labour-friendly” than it anticipated.
Fine Gael has indicated to the Labour Party that increases in public spending are likely to hugely outweigh tax cuts in the new programme for government.
However, Fine Gael remains uncertain that it can persuade enough Independents to support it to make a minority government feasible.
Labour’s seven TDs would make a significant difference to the Dáil arithmetic. It is also likely that if Labour agreed to consider a return to government, the Green Party would follow suit.
Draft programme
The draft programme for government is also likely to promise the appointment of a minister for housing – a post that would almost certainly be offered to Labour – and a “pathway” to a referendum on the Eighth Amendment, according to sources familiar with the discussions.
But there is certain to be strong opposition within Labour to participating in the next government.
Ms Burton’s position as party leader has been under pressure since Labour lost most of its seats in the general election, and party members are discussing her would-be successors.
Labour won 37 seats in the 2011 general election but, following a term in coalition with Fine Gael, saw its number fall to seven after February’s poll.
One TD said that the mood among the party’s grassroots is “virulently against going back in”, while several others in recent weeks have said that the party should go into opposition to rebuild after the election.
However, some senior figures are telling their colleagues that the next Dáil opposition will be very different from anything Labour has experienced in the past.
The party would be competing with Fianna Fáil, Sinn Féin, the radical left parties and Independent TDs for parliamentary and media attention.
Labour TDs are likely to discuss whether they should back Mr Kenny again whenthey meet before tomorrow’s vote for taoiseach.