Voters Produce 'Hung Parliament' in UK Election

LONDON (May 7) -- Britain's political leaders began tense negotiations Friday to form a new government, after a closely fought election gave no single party the clear majority it needs to push policies through the 650-seat House of Commons.

At the moment, the country's next prime minister looks likely to be David Cameron of the opposition Conservatives. His center-right party won the highest number of seats, but fell just short of the total they'd need to easily outvote Gordon Brown's Labour -- which has ruled Britain for 13 years -- and the smaller Liberal Democrats.

That result is known here as a "hung Parliament," and means that two of the main parties will likely have to join forces -- or at least cooperate much of the time -- in government. Prime Minister Brown will remain in office until the Queen accepts his resignation, should he offer it, and invites his successor to form a government

Conservative leader Cameron started the political wooing on Friday afternoon, by reaching out to the Liberal Democrats, saying he was prepared to make them a "big, open and comprehensive offer." Later William Hague, who would take over as Foreign Secretary if the Tories form a government, told Sky News that Liberal Democrats could be handed ministerial positions in a possible future coalition. "David Cameron hasn't excluded that possibility," he said. "We haven't excluded any form of arrangement."

During his afternoon announcement, Cameron noted that the two parties shared many goals, including cutting taxes for the poorest members of society, helping disadvantaged schoolchildren and promoting a greener economy. And the Tory leader pledged to look at reforming the country's electoral system, which is currently weighted against small parties like the Lib Dems.

However, Cameron also emphasized that his government would not offer an amnesty to illegal immigrants, hand over more political power to the European Union or shrink the country's nuclear arsenal -- all key policy aims of the center-left Lib Dems.

Liberal Democrat officials confirmed that party leader Nick Clegg talked with Cameron on the phone following his speech, and that the two "agreed that they should explore further proposals for a program of economic and political reform." Leading members of both parties, but not Cameron or Clegg, will hold face-to-face talks tonight.

Yet despite the ongoing Clegg and Cameron negotiations, parliamentary rules state that the incumbent -- in this case, Brown -- always has the first right to try to establish a new government. Today, Brown said, "Should the discussions between Mr. Cameron and Mr. Clegg come to nothing ... I would be prepared to discuss with Mr. Clegg the areas where there may be some measure of agreement between our two parties."

How this highly muddled vote is resolved is now largely down to the Lib Dems. If Cameron fails to win them over, they might offer their support to Brown, whose agenda is ideologically closer to their own. But such a deal would be hugely unpopular with many voters, who would view it as an "alliance of the losers" unfairly blocking the victorious Conservatives from power. Cameron has said that Labour has "lost its mandate to govern" and has no right to try and form a ruling coalition.

If the Lib Dems refuse to formally join in a coalition with either party, the Conservatives would take power as a minority government. That would involve winning the backing of parliamentarians from a range of other parties -- including the Lib Dems and Scottish and Welsh nationalists -- on a vote-by-vote basis. That might be the most appealing option for Clegg's party, as they will be able to pick and choose which Conservative policies to support and distance themselves from the fallout of unpopular decisions.

Wrangling over the shape of the future government is expected to continue well into Saturday, or even longer. The last time Britain faced a hung Parliament was in 1974, when Conservative Prime Minister Edward Heath spent four days attempting to fashion a coalition government after winning fewer seats than Labour did. When his frantic negotiations failed, he stepped aside. Labour leader Harold Wilson then formed a minority government, which lasted eight months before another election was called. Perhaps reassuringly for Cameron, Wilson went on to win that vote.

But it's unlikely that any form of minority or coalition government will please the money markets, which want a strong administration capable of taking decisive action on the country's soaring deficit. Currency traders this morning delivered their verdict on the confused state of British politics: The pound fell to a one-year low against the dollar and plummeted against the euro.