Taoiseach Brian Cowen has resisted growing demands to resign immediately and announced he is to seek the dissolution of the Dáil after provisions of the forthcoming budget are enacted.

He made the announcement at Government Buildings tonight, hours after the Green Party called on him to set a date for a general election by the second half of January.

Mr Cowen called Fianna Fáil Cabinet members to a meeting at Government Buildings this evening, after which he told a press conference he would seek the dissolution after the provisions of the budget, which is to be delivered on December 7th, are enacted into law.

It could take several weeks for the budgetary process to be complete, after which the Taoiseach would have to formally dissolve the Dáil and set a date for polling day. This means an election may not be held until February or March.

“The interests of the electorate, of all the people, will not be served by delaying or worse still casting into doubt the steps which are necessary to secure our economic and financial futures,” Mr Cowen said.

“I’m saying that it is imperative for this country that the Budget is passed. I’m also saying that it is highly important in the interests of political stability that that happens.”

“It’s very important for people to understand that any further delay in this matter in fact weakens this country’s position”.

Mr Cowen had been coming under increasing pressure to step down over the day, with a number of Fianna Fáil backbenchers joining Opposition calls for the Government to resign in the wake of the bailout by the IMF and EU.

Fine Gael’s Enda Kenny said an election was required in order to provide the clarity and certainty, Labour’s Eamon Gilmore said the Government had shown it was incapable of leading the country and Sinn Féin Dáil leader Caoimhghín Ó Caoláin said the Greens were preparing to "cut and run".

Meanwhile, two of the three Independent TDs on whose support the Government relies today said they may not vote for the budget. Kerry South TD Jackie Healy-Rae today said recent events "have totally undermined whatever little bit of confidence” he had in the Government, while North Tipperary TD Michael Lowry said it was "highly unlikely" that he would support the budget.

With the support of Minister for Health Mary Harney, Mr Lowry and Mr Healy-Rae, the Fianna Fáil/Green Party Coalition had 82 TDs compared to 79 Opposition votes, a working majority of three, although that would be cut to two if Fianna Fail fails to win the Donegal South West byelection.

Labour Party justice spokesman Pat Rabbitte said the Government could still get the a budget passed, but only on the casting vote of the Ceann Comhairle.

He said the Green Party had put themselves in the “ludicrous situation” of being both in and out of Government.

When asked if the Labour Party would support the budget, Mr Rabbitte said: “As far as we’re concerned, we haven’t seen the budget. We’re not going to give approval sight unseen. We’re not going to give the Government a blank cheque”.

Fianna Fáil backbencher Chris Andrews said the Taoiseach had lost the confidence of the public and it was “unrealistic” to expect the budget to pass.

He said Mr Cowen should step down and allow negotiations to take place between his successors and the Opposition to ensure that the budget is passed.

Speaking at a press conference in Government Buildings this morning, Green Party leader and Minister for the Environment John Gormley said his party would pull out of Government after the budget was passed. He said it was now up to the Taoiseach to set the date for the poll.

He criticised Fianna Fáil over the bailout plans, accusing ministers of "miscommunication" over the bailout issue. “We were given an official line ... which was essentially a mixed message,” he said.

He defended his party's decision to stay in Government with Fianna Fáil until after the budget, insisting it was in the national interest to ensure it was passed.

"We have always said that our involvement in government would only continue as long as it was for the benefit of the Irish people. Leaving the country without a government while these matters are unresolved would be very damaging and would breach our duty of care," he said, adding that the Irish people need political stability over the coming months.

He said the decision to pull out of Government was made on Saturday after a long series of meetings and it was unanimous within the party.

Mr Gormley said his party was proud of what had been achieved since it went into coalition with Fianna Fáil. "Since entering government in June 2007, we in the Green Party have worked to fix and reform the economy. It has been difficult. We have taken tough decisions and put the national interest first," he said.

Minister for Energy Eamon Ryan said it is “in the national interest” for the Dáil to pass the December budget and for all members of Dáil Éireann to recognise that and to play their part.

"This is not a times for party politics, it is a time for national politics,” Mr Ryan said. “We are listening to people, we understand how people feel and what we want to give is a certain amount of certainty and an actual process within which that certainty politically and economically can be arrived at.”

Earlier, Minister for Finance Brian Lenihan dismissed speculation the Greens may be considering pulling out of Government.

Speaking to reporters in Dublin this morning, Mr Lenihan said he had heard “no suggestions” that Fianna Fáil’s coalition partners were about to quit. The Greens had been “very, very loyal partners” in Government since the coalition was formed in 2007, he said.

Separately, a group of people protesting against the handling of the economy managed to force their way through the gates of Government Buildings. The group included Sinn Féin TD Aengus Ó Snodaigh.