The biggest publicans in the State last month suggested that the proposal to create cafe bars should be dropped in favour of liberalising of restaurant alcohol licences, it has emerged.
Minister for Justice, Equality and Law Reform Michael McDowell yesterday claimed he had not backed down by scrapping his cafe bars plan, following major opposition from Fianna Fáil TDs.
Instead, he said all restaurants would be able to apply for new licences allowing them to serve wine, beer and spirits once the Intoxicating Liquor Bill is passed.
"Those people who opposed the delicate architecture of the café bars legislation are now faced with a more radical proposal coming from me," he went on.
However, his declaration that his new plan is even more radical than his first was put under question after it emerged that the Licensed Vintners' Association (LVA) proposed the compromise more than a month ago.
The Minister will address the Fianna Fáil parliamentary party meeting tonight, which will include 40 Fianna Fáil TDs who openly opposed his cafe bars plan.
In a submission to the Government, the LVA said "the most obvious and effective means" of liberalising the market "is to make it even easier for restaurants to sell alcohol".
Meanwhile, the Minister for Justice has softened his tone on ending the current rules whereby new pubs must buy an old licence before opening up.
Last week, he said he would end the one-for-one extinguishments rule - which net retiring publicans €175,000 a time - unless publicans accepted cafe bars. Yesterday, he said the rule could fall foul of European Union rules because Brussels would have to vet the final licensing legislation before it came into force.
"There are implications for EU law which my department is now exploring," Mr McDowell said.
"One of the consequences of the cafe bars idea not going ahead is that the focus will now be thrown in Brussels on the one- for-one extinguishments which could affect inter-state trading.
"I am not being frustrated because I am going the radical route that I would have preferred in the first place."
Meanwhile, Taoiseach Bertie Ahern said the Progressive Democrats had not been "slapped down" by Fianna Fáil in the row over cafe bars. "I don't see that. In any coalition government, or in any government there are differing views. People put forward their views. It is a healthy thing that we have the debate," he said.
However, the Taoiseach carefully avoided making clear his attitude toward Mr McDowell's warning about extinguishments rules. "There is a view that there are 12,000 pubs in this relatively small country that all serve food practically, very good food," he said. Some people believed that having "every coffee bar" selling drink would "do nothing for the health of young people".
"I don't get too het up about this one way or the other, but I have listened to the argument that to have thousands of more outlets for drink is not the thing to be doing," he said, adding that he had met a delegation which had argued forcibly against liberalisation.
Many restaurants are already serving all alcohol drinks without a licence, he added: "The public think that because half of them are doing it that that is legal, but of course it isn't."
Mr Ahern pointedly rejected charges that he had bowed to lobbying by vintners, though some FF TDs are concerned that that is already the public perception.
"To be frank with you, the groups who bothered to come to me about this did not include the publicans. They were medical groups and others."
Meanwhile, Tánaiste and Minister for Health and Children Mary Harney denied that the PDs had climbed down.