Fishburn Hedges

18.03.2010

Hung parliaments are rare beasts. Because the swing in key marginals is difficult to predict many commentators aren’t yet clear about the number of seats that will change hands at this election. Polls suggest a shift in voting intention but it’s hard to call a decisive majority for the Conservatives at this stage.

We are almost certainly closer to a hung parliament than we have been since the early nineties. Using some simple parliamentary arithmetic and breaking a few myths, we can calculate the likely outcomes.

The mechanics of a hung parliament

Let’s start with busting a myth. If no party can achieve an outright majority the largest political party doesn’t get first dibs on forming a minority government. In fact, the government of the day is given the first opportunity to strike a deal and form an administration. If it fails, the baton is passed to the opposition parties. 
 
The key rule to forming a new administration is that the government must enjoy the ‘confidence’ (or support, in other words) of a majority of the House of Commons. So, effectively there are three options in a hung parliament: 

A minority government - sustained by informal parliamentary arrangements, where parties agree to support each other on key votes or legislation
A coalition government - a formal agreement between parties, including the possible sharing of Cabinet seats
A failure to produce a government - parliament is dissolved and a further General Election called

A government can operate perfectly well as a minority administration – just look at the example of the SNP minority Government in Scotland. Alex Salmond’s party largely survives on decisions made through executive orders which don’t require many parliamentary votes. Running a government in this way would be a radical departure for the Westminster Parliament, but a minority doesn’t have to mean a neutered government.  

What does this mean for UK Plc?

Speculation on the polls has already made the City jittery. Damage to the markets is most likely to be done in the build up to, and the immediate aftermath of, the election.
 
Once the hung parliament horse-trading is over and a new government is in place, the markets are likely to calm. The wider question of Lib Dem impact on a possible Conservative budget may, however, give the City pause for thought.

What would Government look like in a Hung Parliament?

The Liberal Democrats, and possibly the Democratic Unionist Party, are likely to play a pivotal role in a hung parliament – leading many to dub them ‘kingmakers’. In the case of the Lib Dems, their leader, Nick Clegg, has been at pains to state there are no done deals ahead of the election. But he’s also said that the largest party will ‘have the strongest claim’ to govern on its own or to seek alliances. 

What would this kind of government look like? Based on current polling, the Conservatives will form the largest party but without a majority. In step the Lib Dems.  Clegg has pledged to secure key policy concessions rather than Cabinet seats – meaning we are more likely to see a minority rather than a coalition government. 

The Lib Dem hung parliament wishlist, which could be fused with the Conservative manifesto, is as follows:

Fair taxes - close loopholes for the richest and introduce a tax on mansions 
Political reform - reduce the number of MPs by 150; devolve power over the police and NHS to be devolved to local communities; change the voting system to abolish ‘safe seats’
A rebalanced, green economy - inaugurate a shift away from the ‘over-reliance’ on financial services, placing greater emphasis on infrastructure and green technology
A new, fair start for all children at school - reduce class sizes and increase one-to-one tuition in schools

What happens beyond a minority or coalition administration is the subject of further debate. Senior Conservatives have hinted that a further snap election will be called in the event of a hung parliament, to seek a full mandate. Wilson’s Government in 1974 provides a precedent here. 

But regardless of a second 2010 election, there could now be a period of six months or more when we’re governed by a minority or coalition government. This is likely to mean that the biggest, boldest pledges in party manifestos cannot be immediately delivered and that we will see a smaller government role for some months to come. Could this mean, for example that RDAs and quangos are given a temporary reprieve? We’ll know in May.