A Fianna Fail TD says the Minister for Finance is lying when Michael Noonan accused his party of "pulling a stroke" to appoint its own Senator - Marc McSharry - to the banking inquiry.

The Minister for Finance has defended the decision to add two extra government senators to the Oireachtas banking inquiry.

Michael Noonan said it was necessary to add two extra members after Fianna Fáil "took advantage" of unusual circumstances to appoint its own Senator, Marc MacSharry, to the inquiry.

One of the Senators at the centre of the row, Michael Darcy, has indicated he has no intention of stepping down.

Michael Noonan says the move by Enda Kenny to add the two extra seats is a completely routine decision.

But speaking to Midwest Radio, Deputy Dara Calleary says he strongly disagrees with the interpretation by the Minister of what happened.

There have been calls for the two extra Senators to resign from the inquiry, after Independent TD Stephen Donnelly resigned in protest at the move.

Mr. Donnelly said earlier he would welcome dialogue with Enda Kenny over how to proceed, but warned that the move to force a government majority was a "subversion of democracy".

He said that that is a welcome first step, but insisted he will not return unless the original membership of the inquiry is restored.

"Yes I guess I would, yeah" he said.

"On the basis that teh Tanaiste and the Taoiseach also said the whip was going to be removed, if Senator Darcy and Senator O'Keeffe said 'yeah look, we're going to back out of this' - and it was restored to what then Oireachtas originally decided - then I guess yes".

"Of course I would talk to the Taoiseach of the country at any time - I would, but I want to stress: this isn't about me re-joining the committee".

"The Dail is full of very capable people" he added.

The Minister for Communications Pat Rabbitte has admitted the addition of two extra government Senators to the inquiry has been "clumsily handled".

But he says it is important to get on with the banking inquiry.