Ireland's premier to resign May 6

DUBLIN, Ireland -- Prime Minister Bertie Ahern, the common-touch Dubliner who tended Ireland's economic boom and the blossoming of Northern Ireland peace, announced his resignation Wednesday under a darkening cloud of financial scandal.

The announcement stunned Ireland and much of his Cabinet, whose members stood by Ahern during an 18-month battle against allegations he accepted secret cash payments from businessmen in the 1990s.

Ahern, who governed Ireland through 11 years of growing prosperity at home and peace in Northern Ireland, maintained his innocence.

"I have never received a corrupt payment, and I've never done anything to dishonor any office I have held," Ahern said during a hastily called news conference on the steps of government headquarters. "I know in my heart of hearts I've done no wrong and wronged no one."

Ahern said he would also step down as leader of Fianna Fail, Ireland's largest party, on May 6, one week after he addresses Congress in Washington -- an honor that reflects his pivotal role in Northern Ireland peacemaking over the past decade.

Opposition leaders said Ahern had tarnished his legacy by not resigning sooner.

The main opposition leader, Fine Gael party chief Enda Kenny, urged an immediate election, less than a year after Ahern narrowly defeated Kenny's rival coalition to win a third straight term.

Kenny said Ahern's administration, including heir apparent deputy prime minister Brian Cowen, was complicit in a campaign of deceit.

"Not one of them confronted him. Not one of them disowned him. Not one of them were prepared to say that taking large sums of money was wrong, that it was wrong for [Ahern] not to pay his taxes, that it was wrong to use Fianna Fail money for private use," Kenny said.

Analysts agreed Ahern's successor, almost certainly Cowen, will not call an early election -- and will face much tougher economic times.

Ahern, 56, became prime minister in 1997 when Ireland was already beginning to experience unprecedented economic growth on the back of high-tech investment, chiefly by American companies attracted to Ireland as a well-educated, English-speaking base in Europe.

He kept Ireland's business taxes low despite European Union pressure to raise them. As a result Ireland continued to attract foreign investment, even as wages soared in line with the country's increasingly high cost of living.

But the so-called Celtic Tiger faded this year, as Ireland's export-dependent economy -- closely tied to American economic fortunes -- has slowed rapidly. Unemployment is surging and the middle classes are struggling to cope with high inflation and unaffordable housing.

Ahern played a pivotal role in securing peace in Northern Ireland after three decades of bloodshed that left more than 3,600 dead, and even his most ardent detractors acknowledged that Wednesday.

Within weeks of rising to power, Ahern forged a close alliance with Britain's newly elected prime minister, Tony Blair. Over the next decade the two coaxed rival factions together, producing the Good Friday peace accord of 1998, the Irish Republican Army's disarmament and abandonment of violence in 2005, and the revival of a Catholic-Protestant government in Belfast in 2007.

Former senator George Mitchell, who led the 22 months of negotiations that resulted in the Good Friday pact, said Ahern's hands-on involvement -- particularly in the final round-the-clock week -- was critical.

"Total dedication and a common-sense approach: That, I think, were the keys to his success," Mitchell said.

Cabinet ministers said Ahern gave no hint he was about to end his political career as they gathered Wednesday for their weekly breakfast meeting. Only Cowen, Ahern's right-hand man for the past decade, said he had been told beforehand.

"There was a shocked silence ... People genuinely did not expect it," Education Minister Mary Hanafin said.

Ahern's hold on power has been steadily weakening since investigators discovered cash payments he secretly received from businessmen in the mid-1990s.

Ahern initially claimed he received just two major payments from personal friends totaling $96,000 in December 1993 and January 1994. But the investigation has since uncovered about a dozen suspicious cash deposits running up to December 1994 allegedly involving Ahern, who is due to resume testimony next month.

An Irish Times analysis published Saturday found that the tribunal was investigating transfers and deposits -- in accounts controlled by Ahern, his daughters, his former girlfriend or his local party office -- that total 452,800 Irish pounds from 1989 to 1997. The newspaper calculated that, adjusting for inflation, the sum equates to $1.39 million today.

Ahern, who kept no personal bank accounts at all before 1994 and dealt solely in cash, has denied any involvement with most of the money.

Last month, Ahern's former secretary was reduced to tears on the stand as she first denied, then admitted, taking about $30,000 in British currency to deposit in accounts controlled by Ahern and his two daughters on a single day in 1994.

The leaders of the two other parties in Ahern's coalition government, the Greens and Progressive Democrats, called last week for Ahern to explain the contradictory testimony. It was the first expression of public discord in their 10-month-old government.

Confidantes said Ahern had hoped to announce his retirement next year, after leading Fianna Fail through local and European Parliament elections. But the pressure of trying to run the country and mount a defense proved too much.

"It just was taking a terrible toll on him," said Sen. Eoghan Harris, a close friend. "It was the sheer weight of the campaign, opening up the paper every day and seeing bad things about you, (and) hearing people call you a thief and a liar and a perjurer."

Still, opinion polls indicate Ahern has retained the affections of a majority of his countrymen.

In Ahern's favorite pub, Fagan's, opposite his constituency office in the inner north district of Drumcondra, patrons had only praise for a politician they all know as Bertie.

"I felt sad today, shocked," said Jim McKenna, 55, as he watched the television news with friends over a pint.

"Bertie's brilliant. He would even talk to the dogs on the street," McKenna said. "Any time I'd be in, he'd pop in and he'd always buy a pint for anyone in his conversation. I hope to see him in here soon for a celebration drink."