THE VAST policy divisions between Fine Gael and Labour have been highlighted in an attack by Fine Gael senator and general election candidate Paschal Donohoe on his likely coalition partners.

Fine Gael's latest attempt to 'put clear blue water' between itself and Labour has come in the form of a Christmas posting on Donohoe's blog this weekend.

The senator said: "Just as economic uncertainty caused huge damage to our country it is vital that we make sure that political uncertainty does not do the same."

He advocated that "political parties must now make clear to the electorate where they stand on the tough choices facing the country... I believe there are certain core Fine Gael policies that should not be lost in a coalition deal."

He said Fine Gael should not accept Labour's policy of higher taxation, and that there should be no more than €4.5bn in extra taxes. He said he favoured minimising tax increases through a reduction in public service costs and advocated that Fine Gael "stick by our plans for patient choice of insurance and healthcare providers under a reformed health system and NewEra jobs stimulus".

"Reform of the Oireachtas and a referendum on the abolition of the Seanad are also untouchables," said Donohoe.

He did acknowledge that the two parties had "a great deal in common", but there were some policies that were "simply no-go areas" for Fine Gael. Among these is a Labour proposal to increase marginal income tax rates to 59% for earnings over €100,000. Donohoe labelled that idea "populist" and claimed it would "make it very difficult to attract foreign direct investment and support local enterprise".

He said Fine Gael should oppose the nationalisation of existing non-banking private enterprises and warned that the new government must not allow "the politics of fudge [or] repeat the mistakes of the past".

Earlier this month, Donohoe criticised the language used by certain Labour figures following the arrival of the IMF. He accused Labour of engaging in "dangerous attempts to reflect the national gloom rather than help lift [Ireland] out of it".