Any general election result is better than none
The pollsters and the pundits are agreed: the choice at the general election will be between a hung parliament headed by David Cameron and a hung parliament headed by Gordon Brown. Oh dear; the country needs a government, not a choice of two non-governments.
Polls can be wrong, of course, but the prospect of a hung parliament is a serious concern for business, nevermind the wider electorate. Sometimes electing a government that will be preventing from taking radical action is a good thing; at present, it could be disastrous.
Both major parties have plans for getting the economy back on the rails. They argue about degree and timing but they are both pointing in the same direction. Yet the danger of an inconclusive election is that whoever is declared winner does nothing rather than something.
A hung parliament is when the party with most seats does not have an overall majority and has to form a coalition with a minority party or do a series of deals with smaller parties or individual opposition MPs. The governing party cannot tolerate any of its own supporters voting against it. The government is thus shackled, unable to do anything controversial that would not have the support of some of its rivals and becomes beholden to small groups with valuable votes, introducing policy to please just that handful of MPs.
It is not a way to progress a programme to reduce the UK’s spending deficit, nevermind reduce its debt. Investors would take fright at the lack of progress and danger of diversion, selling the pound and demanding higher interest rates. Stockmarkets would likely be hit too. For business, that means higher import costs, higher borrowing costs and difficulty in raising equity capital as well as an economy that fails to deliver growth.
If one party thought it could struggle through for five years without a majority of MPs it might just seek to reach a consensus with the main opposition party to produce a co-ordinated economic policy that satisfied the markets. This need not be a coalition or government of national unity: a place in cabinet or just on cabinet committees for opposition politicians might be enough.
But if the party that forms the government after the election thinks it can hold another poll that might result in a majority, then the prospect of shared government is nil. Both parties would want to remain independent pending the next election – and neither would advance tough policies for solving the economic problems for fear of scaring off voters. Markets would react negatively to the prospect of several more months on non-government.
Britain – business as well as government - would be in limbo until the second election – which might be no more decisive.
For those with longer memories, the 1964 general election returned Labour with only a minimal majority and prime minister Harold Wilson held another poll after 18 months; in 1974 the Conservative Edward Heath tried to hang on as prime minister with a minority government but failed to gain Liberal support and handed the reins back to Wilson who held a second election after just eight months. Wilson won, but Labour had to do a deal with the Liberals to stay, uneasily, in power.
The other year of two general elections was exactly 100 years ago. The first poll gave the Conservatives 272 seats and the Liberals 274 but with minority parties holding 124 seats. In the second election, in December, the Tories won 271 seats and the Liberals 272 with 127 other seats. The Liberals formed a government under Asquith but on each occasion the Conservatives polled more votes, despite winning slightly fewer seats.
History does not repeat itself neatly, but the century-old precedent showed how messy a non-outcome could be for politics and country. If nothing else, the prospect of a hung parliament in 2010 should encourage all parties to redouble their efforts to become an outright winner.
