Fianna Fáil leader Micheál Martin has rebuffed a request from Taoiseach Leo Varadkar to open talks seeking to extend the Confidence and Supply Agreement between the parties to summer 2020, with an election to be held then.
Mr Martin said Fianna Fáil would discuss the review process around the Confidence and Supply Agreement once the Budget was announced next month.
The Taoiseach sent a letter to Mr Martin, which he has since released on Twitter, setting out "the ambitious programme of work we want to achieve over the next two years".
I wrote to the leader of Fianna Fáil last week seeking to open negotiations on an extension to the Confidence and Supply Arrangement and an agreed election date in Summer 2020. In the letter I set out the ambitious programme of work we want to achieve over the next 2 years.... pic.twitter.com/DxZR6JQHD6— Leo Varadkar (@campaignforleo) September 4, 2018
Mr Varadkar said that a Government could not function if it was living on borrowed time and he said that such uncertainty weakened the Government's hand in the Brexit talks.
The Taoiseach said he was willing to appoint a team to begin negotiations immediately.
Fianna Fáil had previously said it would not begin any talks to extend the deal until after the Budget, which is five weeks away.
However, Mr Varadkar said: "A Government cannot function properly if it does not know if it will last from week-to-week, month-to-month, or if it does not know what will happen the day after the Budget."
Both parties are already scheduled to meet tomorrow to discuss the Budget.
Mr Martin said he did not think it was reasonable for the Taoiseach to suggest that the Government could not function if it did not know it would last from week-to-week.
The final line of Mr Martin's return letter stated that: "If there are any difficulties in the meantime please feel free to contact me directly, as per the Confidence and Supply Agreement."
Minister for Finance Paschal Donohoe said the Taoiseach's letter was concerned with avoiding an election and not trying to cause one.
He told RTÉ's Six One News that "it is in all of our interest that when the Taoiseach is representing the State in a period of vital (Brexit) negotiations, which could impact for generations to come, that there is a stable government in office".
Minister Donohoe said that every Budget that this Government had passed had been a housing budget and has been about making a difference to the lives of those dealing with housing difficulties.
However, he said it was important to let negotiations with Fianna Fáil begin before commenting further.
Minister for Justice Charlie Flanagan said the Taoiseach's request to extend the agreement with Fianna Fáil was what "new politics is all about".
Speaking on RTÉ's News at One, Mr Flanagan said operating a minority Government brought challenges and it was important to provide stability and certainty.
He also said he did not subscribe to speculation about the Taoiseach that he was considering calling a snap election in November.
Speaking on the same programme, Fianna Fáil justice spokesman Jim O'Callaghan described Mr Varadkar's letter as unusual and said it was "unnecessarily creating instability".
He said Fianna Fáil was happy to discuss the matter after there was agreement on a third Budget.
Mr O'Callaghan said he believed the Taoiseach wanted to have an election this year.
"He [Mr Varadkar] knows however that under the terms of the agreement he can't have an election in October or November, and that's why I believe he's trying to orchestrate a mechanism of trying to get out of it," said Mr O'Callaghan.
"But he needs to concentrate on the priorities facing the country, rather than the priorities facing Fine Gael ministers and himself."
Fianna Fáil deputy leader Dara Calleary said his party would be looking for specific measures on housing, when Budget negotiations begin tomorrow.
He told RTE's Six One News that "politics isn't a game" and described relations between his party and Fine Gael as "business-like."