The Government is prepared to let the European Investment Bank nomination procedure run its course rather than withdraw the candidature of Mr Hugh O'Flaherty for vice-president.
In spite of mounting evidence that a majority of the bank's directors are opposed to the nomination and that its management committee will conclude next Wednesday that Mr O'Flaherty has not secured sufficient support to be formally nominated, a Government spokesman insisted its position had not changed.
The Minister for Finance, Mr McCreevy, will return from holiday today, and his officials are expected to contact the bank to establish its intentions and to explore what procedures are likely to be adopted at tomorrow's and Wednesday's meetings. The Taoiseach, Mr Ahern, has declined to make any comment about the matter.
There was no official response to a report in the Sunday Business Post that the former Supreme Court judge is now prepared to stand aside in favour of another Government candidate, if formally asked to do so by Mr Ahern or Mr McCreevy.
Mr O'Flaherty could not be contacted last night. But he said on a previous occasion that he would be guided by the Government's wishes in the matter.
A spokesman for the Department of Finance said last night: "Our position is that the nomination is a matter for the European Investment Bank". The voting process was still going on, he said, and it was possible the decision deadline on the nomination might be extended until the holiday period finishes at the end of the month.
The spokesman was not aware of any recent contact between the Department and Mr O'Flaherty about the matter.
A report in last Saturday's Irish Times reactivated the long-running political controversy. It said the bank was preparing to tell the Government there had to be some finality in the matter and that a decision not to proceed with the nomination because of insufficient support was likely to be reached at this week's management meeting.
The leader of the Labour Party, Mr Ruairi Quinn, said the Government's behaviour in relation to the appointment had reached "farcical proportions".
The appointment had been wrong from the start, he said, but both Fianna Fail and the Progressive Democrats had insisted on proceeding with it in the teeth of strong public opposition. Now it appeared that the EIB was going to block the appointment.
Calling on the Taoiseach to make an immediate statement on the matter, he said Mr Ahern had ducked issues of public accountability since taking office, but he and Mr McCreevy could not avoid responsibility for this decision.
"The question now is: how much political capital will the Government attempt to expend over the next week to secure this job for their man? No European institution wants to, or sets out to, embarrass a national government like this. It is unprecedented. This controversy is damaging to all involved. But these reports are an indication of the extent to which the EIB feels damaged and compromised by the inept bungling of the Government.
"It is ironic that the EIB seem more concerned than the Government about the damage this appointment is doing to Irish and European institutions in the public mind," Mr Quinn said.
The president of the EIB, Mr Philipe Maystadt, will chair the management committee meeting that will deal with the £147,000a-year job. It is understood that only six directors out of 25 have voted for Mr O'Flaherty's nomination. He requires at least 13 votes.