BL<Cameron, Clegg Seek to Show Progress on U.K. Coalition Before Markets Open
By Kitty Donaldson and Robert Hutton - May 09, 2010
Talks on forming a British government with a parliamentary majority are set to continue into the week as Conservative David Cameron and Nick Clegg’s Liberal Democrats seek to bridge differences on overhauling the electoral system.
Negotiators, who include Liberal Democrat lawmaker Danny Alexander and former Conservative leader William Hague, met in London for a third round of talks today. Cameron isn’t scheduled to brief his lawmakers until 6 p.m. tomorrow.
“It is important to show progress by tomorrow when the markets open,” Michael Gove, the Conservatives’ education spokesman and a Cameron adviser, said today on the BBC’s Andrew Marr Show.
The pound and gilts fell May 7 on concern the political jockeying would undermine efforts to cut a record budget deficit. Sterling fell 0.2 percent to $1.4804 after dropping as much as 2.4 percent and gaining 0.7 percent. Government bonds slid, pushing the 10-year gilt yield up by 3 basis points to 3.84 percent.
The negotiations to form an alliance to oust Prime Minister Gordon Brown were triggered by elections May 6 that failed to produce a majority, resulting in the first hung Parliament since 1974. Brown, who has also appealed to Clegg for an alliance, remains in office.
Hague today called talks with the Liberal Democrats so far “very constructive.”
Calls to Quit
Sixty-two percent of people questioned in a YouGov Plc poll for the Sunday Times newspaper said Brown should quit now. Twenty-eight percent disagreed, YouGov said. YouGov questioned 1,406 adults online May 7 and yesterday.
The Conservatives won 306 districts in the vote, a net gain of 97 from the previous election in 2005. Labour had a net loss of 91 seats to end with 258. The Liberal Democrats lost five seats and now have 57 members of the 650-seat House of Commons.
With Cameron winning the most seats and votes, “one has to assume that he and Nick Clegg can make it work,” Diane Abbott, a Labour member of Parliament from London since 1987, said today on Sky News.
Labour lawmakers Kate Hoey and John Mann became the first of the party’s elected officials to call on Brown to step down.
“It is not tenable for Nick Clegg to be propping up Gordon Brown,” Mann said today on Sky News. Brown “needs to be making plans to step down as Labour leader, and when the government is formed, he should then be stepping down as prime minister.”
Options
Still, Liberal Democrat lawmaker Simon Hughes said a deal with Labour Party should not be ruled out.
The talks with the Conservatives are “not the only show in town,” Hughes told Sky News today. “Let’s see how today goes, how tomorrow goes. If we can agree we will, if we can’t we move on.”
Clegg, 43, told reporters today the Liberal Democrats would emphasize “the big changes we want.” They include changes to the voting system to give smaller parties greater representation in Parliament, an end to income tax for 3.6 million low earners, a breakup of big banks and cutting school class sizes.
Cameron, who says he wants to stick with Britain’s first- past-the-post voting system, proposed setting up a panel to study an electoral overhaul. Brown offered Clegg an immediate referendum on the issue.
There’s a “mountain to climb” to narrow policy differences between Liberal Democrats and Conservatives, former Liberal Democrat leader Paddy Ashdown said today on the Marr Show.
Brown, 59, who was in Scotland today, would need an unprecedented four-way alliance including Scottish and Welsh nationalists to stay in power.
‘Self-Evident’
Brown’s inability to lead such a coalition is “self- evident,” Ashdown said.
A failure by either Brown or Cameron, 43, to come to terms with potential allies would probably result in Cameron seeking to establish a minority government.
Brown remains as prime minister until he advises Queen Elizabeth II, as head of state, that he is resigning. As Britain has no written constitution, the 84-year-old monarch is guided by conventions built up over hundreds of years. The main requirement for the queen is to find a political leader who can command the confidence of the House of Commons.
“I am working on the assumption that we are going to have a minority government,” Simon Henig, a lecturer in politics at the University of Sunderland, said in a telephone interview. “There have been no formal deals in Britain apart from episodes during the wars.”
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