Economic stability and deficit reduction central to coalition talks
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The Conservatives and LibDems have both stressed that economic stability and a reduction of the budget deficit are central to any deal between the two parties.
Following a day of talks between the two parties yesterday, Tory Shadow Foreign Secretary William Hague and LibDem chief of staff Danny Alexander both emerged to deliver short statements.
Hague told reporters that “a central part of any agreement that we make will be economic stability and a reduction of the budget deficit”.
Alexander said: “We are agreed that whatever any agreement made will have deficit reduction and economic stability at its heart.”
The two parties clashed on how to tackle the budget deficit during the election campaign with LibDem Shadow Chancellor Vince Cable warning that Tory calls for the deficit to be slashed far quicker than the Government planned risked halting the economic recovery.
If a deal is reached, it is yet to be agreed whether it would take the form of a formal coalition or a pact between the two parties working on an issue by issue basis. Conservative leader David Cameron indicated on Friday that he is willing to offer tax concessions to the LibDems. The LibDem manifesto included a £17bn package of tax reforms to help lower earners including raising the starting income tax threshold to £10,000. The LibDems are likely to push for the Tories to abandon their proposal to raise the inheritance tax threshold to £1m.
Prime Minister Gordon Brown and LibDem leader Nick Clegg (pictured) also held private talks yesterday to discuss a possible coalition should a LibDem/Conservative deal fail.
Labour have offered the LibDems a referendum on electoral reform, something the Tories are refusing to put on the table.
It has been reported that senior Labour figures are proposing an offer to Clegg which would see Brown step down as Prime Minister as part of a power sharing deal.
The SNP has indicated that it would support a coalition Government made up of Labour, the LibDems and other smaller parties.
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Readers' comments (3)
Michael White, emailmortgages.com | 10 May 2010 10:39 am
To reiterate comments I made in an article a few days ago, this hung Parliament is likely to have a debilitating impact on the economy in the coming months as political posturing gives way to indecision and delay in implementing much needed changes to fiscal policy.
Moreover, and quite interestingly from a mortgage intermediary perspective, is that base rate increases taking place sooner then anticipated is likely to result in a stampede of remortgage enquiries as the masses realise SVR is not the attraction it once was. This is OK for those who can remortgage, but what about the vast swathes of borrowers or potential borrowers who are going to find themselves at the margins of the market in the coming months and indeed over the next couple of years?
There is certainly a sense of short-sightedness from the regulator in this regard; indeed, one can clearly see a similar process at work in its actions to kill off self-cert/fast-track – depending on whether it’s clear about what each one is? - and non-conforming at the same time. A combination of intrusively applied 'risk free' theory from the FSA matched by 'computer says no' underwriting is very far from ideal. This is the real burning issue that I believe should be commented on, anyone else agree?
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Julian Stevens | 10 May 2010 11:02 am
If the Conservatives refuse to give any ground on the issue of electoral reform, Clegg might just tell them to shove it and, despite all his posturing declarations about "the good of the country" try to cobble together some sort of agreement with Crash Gordon. That would be bad news indeed.
Despite what they're all saying publicly, what's really going on behind the scenes is a lot of brinkmanship.
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Crazy gang IFA member | 11 May 2010 9:30 am
Those who have always voted either Lab or Con have only themselves to blame for all this. Should have voted LD. What these people also fail to grasp here is this is all aboutthe long term viability of the UK. The last election just goes to prove how wrong the first past the post system is and a large majority of people voted for proper Electorial reform. The arrogance of the Tories to try and brush this under the carpet as unimportant and offer AV instead is a worrying and just goes to prove that they are only in it for themselves.
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