As I remember it (from a TV docco a while ago), Cait O'Riordan was the bassist in the band while The Pogues were first developing the song, and so she sang on an early version of it. By the time it came to record it properly, which was a year or so later, O'Riordan had left the band and it wasn't clear who was going to do the female part.

Steve Lillywhite, their new producer, told them that he thought it suited his wife's voice (ie Kirsty MacColl) and could he try it out with her? So he took a tape home and had her record with it, and the band thought it was great when he brought the result back to them, and the rest is history.