MR Michael Lowry is likely to run as an independent candidate in the forthcoming general election following the Taoiseach's decision that he would not be allowed to run for Fine Gael.
Mr Lowry announced his resignation from the party last night, almost four months after the revelation that Mr Ben Dunne had paid for an extension to his Co Tipperary home costing more than £200,000. He resigned as Minister for Transport, Energy and Communications two days after this disclosure.
He later admitted that his tax affairs were not in order, causing further deep embarrassment to his party.
Mr Lowry clearly left the possibility of running as an independent open. He said last night he would most certainly be considering going forward as an independent Fine Gael candidate and party sources appeared resigned last night to the idea that he would. His local popularity means that Fine Gael now faces an uphill battle not to lose its seat in the three-seat constituency.
Mr Lowry has strong support within his constituency party and was considered likely to be nominated for Fine Gael at a selection convention and to retain his Dail seat. A month ago, however, Mr Bruton told him that even if he were chosen by the local party, headquarters would block his candidacy.
Mr Lowry said last night he was quite comfortable with his decision to resign. "I could go through and get a nomination from North Tipperary, but I would be putting the party leader and national executive in a situation where they would have outright confrontation, and I felt that would be damaging to the party and to myself," he added.
Meanwhile, Mr Ben Dunne has confirmed that he paid £20,000 in election expenses to a number of TDs in amounts of £2,000 to £3,000 between 1986 and 1996. In a statutory declaration contained in the second part of Judge Buchanan's report on payments by Mr Dunne, he says he paid no money to public officials, a category which includes civil servants and local authority officials. The second part of the Buchanan report containing Mr Dunne's declaration was given to the Clerk of the Dail yesterday.
According to sources, Mr Dunne's declaration also says that he paid an additional sum of £6,000 on more than one occasion to Mr Lowry for trading expenses.
Mr Lowry referred to additional payments in his Dail statement on December 19th.
Mr Dunne's declaration is understood to mention a payment of £21,000 to the RTE presenter, Ronan Collins, for motoring expenses.
Judge Buchanan's work on the matter is now finished. The Tribunal of Inquiry into the affair is due to begin its substantive deliberations on April 8th.
Mr Lowry is the first and only political casualty of the Dunnes Stores payments affair. The Fine Gael leadership, keen to distance the party from the affair, has wanted Mr Lowry to stand aside for some time.
It is understood the former minister tendered his resignation only after sustained pressure from the party leadership. At a meeting on February 5th, Mr Burton is understood to have given Mr Lowry until the end of February to decide on his future.
Mr Lowry's statement said: "I will now plan for the future and I will frame my decisions in consultation with my family, friends and supporters within the constituency.
Mr Lowry said he would "continue to represent all the people in North Tipperary for the remainder of this Dail to the best of my ability".