Varadkar remains upbeat as talks on government to begin
Fianna Fail leader Micheal Martin has shocked his party members by performing a spectacular U-turn on his long-standing opposition to working in Government with Sinn Fein.
With counting still under way, he reversed his policy on Sinn Fein and opened the door to holding coalition talks with Mary Lou McDonald.
During a day of election shocks, Sinn Fein stormed to the top of the polls, with many candidates having substantial surpluses. They are predicted to pick up anything up to 38 seats, putting them almost on a par with Fianna Fail and Fine Gael.
In Dublin, Sinn Fein swept the boards, with Ms McDonald, Sean Crowe, Louise O'Reilly, Dessie Ellis and Aengus O Snodaigh among those topping the polls in landslide victories which saw a huge surplus of votes being transferred.
Asked about a coalition with Sinn Fein, Mr Martin said: "I'm a democrat. I listen to the people, I respect the decision of the people."
Mr Martin's closest advisers said he believes the parties should take time to consider the seismic election result.
"Just because we talk to a party doesn't mean we're going into coalition with them," a source said.
However, senior Fianna Fail TDs publicly rejected their leader's position and insisted they would not break their promise to voters.
Taoiseach Leo Varadkar categorically ruled out talking to Sinn Fein about forming a government. Ms McDonald said she would talk to all parties about coalition.
Last night, Fianna Fail front bench TDs suggested Mr Martin would do anything to become Taoiseach.
"He's desperate now and knows it's his last chance," a senior party source said.
Party's finance spokesperson Michael McGrath said coalition with Sinn Fein was not a "runner" because they are "polls apart" from Fianna Fail on economic policies.
Fianna Fail's justice spokesperson Jim O'Callaghan also shot down any suggestion of coalition with Sinn Fein.
Having ruled out coalition with the party throughout the election campaign, Mr Martin's stance had noticeably softened.
"I've heard the people speak today. The people have voted in numbers and I respect that," he said.
He added that "one's polices and principles don't change overnight", and said there are still "significant issues" he has with Sinn Fein.
"But, as I say, over the next number of days, we'll tease those out with all concerned."
Mr Martin's advisers were insisting he was seeking to buy some time so the election results could be considered before talks kick-off.
"Everyone needs to reflect and take stock of the election result," a source said.
"No one knew the Shinners would get a vote like that, and it has to be taken into account, but just because we talk to them doesn't mean we're going into coalition."
Senior Fianna Fail figures also said it was their belief that Sinn Fein's preferred option is to remain in opposition.
Mr Varadkar said a coalition between Fine Gael and Sinn Fein is "not an option" and compared such an outcome to a "forced marriage".
He said Fine Gael's position on ruling out a government deal with Sinn Fein has not changed since the election, and his party won votes on that basis.
He made the remarks shortly before his election as a TD for Dublin West was confirmed in the constituency's fifth count.
"It wasn't a tactic or a strategy. It's what we honestly believe and for us coalition with Sinn Fein is not an option," he said.
He warned that it could take months to form a government.
Mr Varadkar said he will talk to other parties including Labour, the Social Democrats, the Green Party and Fianna Fail to see if there is a possibility of forming a government.
However, he said it should be a government with a working majority, and he is prepared to go into opposition.
Asked if there was anything about the election he would have done differently, he said: "There's always things you would have done the same and things you would do differently."
Mr Varadkar said his biggest regret was there was not more time to show results in housing.
Tanaiste Simon Coveney said Fine Gael is still open to forming a grand coalition with Fianna Fail. However, he said Fine Gael would not be offering a confidence and supply agreement to any party.
"The country needs a Government - Fine Gael will work towards the formation of a government, but if we have to go into opposition, then so be it," he said.
Transport Minister Shane Ross was the first high-profile casualty of the election campaign after he conceded in his Dublin Rathdown constituency.