12:00 AM, May 15, 2010 / LAST MODIFIED: 12:00 AM, May 15, 2010

History in the making

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Mahmood Hasan

Strange bedfellows!

THE drama over the formation of the government in Britain has finally come to an end. The Conservatives and the Liberal Democrats have joined hands to govern Britain. After 13 years, the Labour Party will now sit on the opposition benches.
David William Donald Cameron (43), leader of the Conservative Party, has become the new occupant of No. 10 Downing Street. Cameron became a Member of Parliament in 2001 and rose rapidly to become leader of the Conservative Party in 2005.
Since the parliamentary elections on May 6, which produced a hung parliament, the three major parties -- Labour, Conservative and Lib Dem -- have been engaged in frenetic negotiations over the formation of a coalition government. The media was full of stories and conjectures over whether a coalition would emerge or not.
It took five days for the Conservatives and Lib Dems to thrash out an agreement. Together, the “centre-right” Conservatives (306 seats) and “center to centre-left” Lib Dems (57 seats) will have a comfortable majority of 363 seats in the House of Commons of 650 seats.
On May 10, Gordon Brown announced that he was stepping down as leader of the Labour Party. Brown, having failed to woo the Lib Dem to his side, announced that he was resigning as prime minister in the evening of May 11 and left No.10 Downing Street.
That set-off a chain of events in quick succession. Soon after Brown tendered his resignation at Buckingham Palace, David Cameron met Queen Elizabeth II, who asked him to form the new government. Cameron then went to No. 10 Downing Street and made his first statement as the new prime minister.
Nicholas William Peter Clegg (43) had a meteoric rise in British politics. The Liberal Democrat leader has been appointed as deputy prime minister. Nick Clegg was elected as Member of Parliament in 2005 and took over the party leadership in 2007. He was elected Member of the European Parliament in 1999. Nick Clegg has taken a calculated risk in joining the Conservatives. If the coalition collapses before its full tenure, the Lib Dems will be the greatest losers.
The last time Britain had a coalition government was in May 1940, when Neville Chamberlain's national government resigned and Winston Churchill formed an all-party coalition government. It was indeed a war cabinet. That government collapsed in 1945 when WW II ended with Germany's defeat.
A key area of the agreement between the Conservatives and Lib Dems is reducing the budget deficit -- the current deficit of £164 billion (Euro 189 billion), which is 11.6
percent of its GDP, is extremely worrying for Britain. The new government will cut spending by £6 billion in 2010. Immigration from non-EU countries will be restricted. A proposal for election to the House of Lords on the basis of proportional representation will be brought forward.
Reforms in the tax structures for different areas will be introduced. A referendum will be held on whether more power to EU should be transferred. Britain will not adopt the Euro. Trident nuclear missiles will not be replaced. There will be a referendum on alternative voting (AV) system.
The question that analysts now ask is -- how long will this coalition survive? Britain is used to a bipolar political system. What happened on May 11 is considered unusual. Lib Dems have more in common with the Labour Party, but the two actually did not have the numbers to form a government.
The election manifestos of the Tories and Lib Dems were divergent in nature. During the election campaign the two parties crossed swords on a number of issues. It is unlikely that the backbenchers of these two parties will now hang up those weapons. For instance, the Lib Dems had all along wanted proportional system of voting. For the Tories it is not a priority.
If the proposal on alternate voting system goes to a referendum, the Conservative MPs will no doubt fight against it. Again, though the two parties want to reduce the ballooning budget deficit, the Lib Dems are worried that a spending cut will allow the economic recovery to stagnate.
The two parties are so far apart on Europe, immigration, welfare, voting systems, etc that analysts think the two young leaders have gelled together only for power. It is seen as a marriage of convenience. The Agreement can at best be called a “minimum common denominator” for the coalition government.
The areas of conflict may not be far. How David Cameron manages the coalition and survives will be worth watching. The ghost of mistrust between the two will lie in the implementation of the policies.
David Cameron announced the new cabinet on May 12. William Hague (Tory) is the new foreign secretary; George Osborne (Tory) is the chancellor of the exchequer; Dr Liam Fox (Tory) is defense secretary; Vince Cable (LD) is in charge of business and banking; Chris Huhne (LD) got environment and climate change and Ms. Theresa May (Tory) will be the home secretary. The Lib Dems will have four cabinet posts and 16 other positions in the new government.
However, the announcement of the cabinet has calmed the market in London. The share price index (FTSE) went down and the pound sterling was under pressure the past week due to the uncertainty surrounding the hung parliament.
As for the Labour Party, it is most likely that former foreign secretary David Miliband will succeed Gordon Brown as it new leader. They will be waiting for cracks to emerge in the ranks of the Conservative and fresh elections.
Cameron and Clegg have been making statements that the new government will last its full tenure despite differences between the two parties. Cameron said that the coalition could mark an “historic and seismic” shift in British politics. Actually, Britain has never had a peacetime coalition government before. If it survives the full tenure it will indeed be a seismic shift in British politics.

Mahmood Hasan, former Ambassador and Secretary, is Policy Advisor, Center for Foreign Affairs Studies.

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