Water charges would be suspended for nine months to allow for this process.
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While the two parties have not signed off on anything, there is a compromise offer on the table.
Mr Kenny also said “history will be kind” to the outgoing Cabinet, according to one source present, who suggested the remarks were interpreted as being the last meeting of outgoing Fine Gael and Labour Party ministers.
Alan Kelly attacked former coalition colleagues yesterday as he described the suspension of water charges as an act of environmental sabotage.
But no party was able to form a majority government and TDs have so far failed to elect a taoiseach.
But Fianna Fáil leader Micheál Martin says that wouldn’t achieve the suspension of the charges.
As part of the new deal, it is expected an independent commission will be set up to examine the issue of water charges.
Richard Bruton said that yesterday that paying customers should be given their money back in the event they are voted down by the Dáil.
If Fianna Fail have the deal I think they have, then they are quids in for supporting Enda Kenny at the head of a minority Fine Gael led government.
Once the water commission’s report is drafted and sent to an Oireachtas committee, the findings will be debated and voted on by the entire Dáil.
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And, the real mistake in this whole debacle was not to get the Revenue Commissioners on the job of collecting water charges from the start.
