FIANNA Fail and the Progressive Democrats made a series of pledges before the election which could have profound effects on business. Now, the parties will have to sit down to discuss what can be implemented and when, in the run up to the next Budget.

The parties' Programme for Government contains few specifics, but the individual manifestos range widely over issues such as corporate tax, funding for small business and the future of the semistates.

For example, the Progressive Democrats cave firmly stated that Telecom Eireann needs more competition in its main market. The party believes the quickest way of achieving this is to demerge Cablelink from its 75 per cent shareholder Telecom and turn into an independent company in the private sector.

The PDs believe this could bring down the cost of local telephone calls to as little as 2p. Similar arguments have been advanced by Telecom's rivals but much of the responsibility in this area will now rest with the new Minister for Public Enterprises, Mrs Mary O'Rourke. She is likely to first await the outcome of an EU study on the ownership of cable companies by telecommunications operators.

The PDs also believe that ACC, ICC and the TSB should be privatised as it will give them access to new capital and the freedom to develop. The new Fianna Fail Minister for Finance, Mr McCreevy, is likely to initiate an early examination in this area. The Taoiseach, Mr Ahern, was believed to have been prepared to sell the TSB when he was Minister for Finance, but the coalition with Labour fell apart before the deal was done.

In their joint programme for Government, the parties also say a strategic alliance should be considered for the VHI.

Fianna Fail has undertaken not to engage in a "wholesale dismantling" or disposal of state companies. However, it does want the semistate sector to evolve to cope with competition and is in favour of strategic alliances and private investment. It has also undertaken to reserve the right of semistate workers to buy up to 15 per cent of the company.

The first test of this aspiration will come whenever the stalled talks between the Government, Telecom and its workers resume. A major restructuring programme hinges on an employee shareholding of up to 15 per cent in the company.

The various interest groups will not be slow to remind the minority Government of its promises. For example, earlier this week the Small Firms Association (SFA) called on the incoming government to uphold its preelection commitments.

In its preelection bag of promises, Fianna Fail said it would maim towards a situation where profits under £100,000 are taxed at 25 per cent and profits between £100,000 and £250,000 are taxed at 30 per cent." The party also said it would aim to introduce a 10 per cent tax rate for the first £50,000 profits of service firms. At present, the first £50,000 of company profits are taxed at 28 per cent and the rest at 36 per cent.

In its election manifesto, the PDs said they would cut the standard rate of corporation tax from 36 per cent to 25 per cent with the ultimate target of 10 per cent by the year 2010. Fianna Fail, in its manifesto, also promised a 10 per cent tax rate by 2010 and the 10 per cent figure is contained in the joint programme for Government.

The PDs also promised to reduce employer and employee PRSI to improve competitiveness. And it has promised to make the soft loan schemes for small businesses more accessible by lowering the minimum loan threshold to £10,000 from the current £20,000.

Both Fianna Fail and the PDs in their manifestos said there were too many state agencies dealing with enterprise, especially for small and new startup businesses. They have pledged to streamline them. It is understood the new government will examine how to streamline a number of state bodies, including FAS, the Trade Board and Forbairt.

Both parties have given a firm commitment to fight the EU plans to abolish duty free shopping after tune 1999. This is an important issue to Aer Rianta - which runs the state airports - Aer Lingus and other airlines, and the passenger ferry companies, which all derive considerable income from this business.