30 November 2010

The formation of the Conservative / Liberal Democrat coalition now looks inevitable, as decisive political events often do in restrospect.

The electoral arithmetic of the election result – with the Tories as big gainers and Labour as big losers – always tipped the odds against a Labour / Lib Dem coalition. This is not least since it would have depended on the support of smaller groups on a day-to-day basis to win Commons votes.

But until the final day, such a rainbow grouping and other options which had seemed more likely before the election – notably a Conservative minority government – remained open.

What tipped the balance was the subject of an absorbing Institute for Government seminar involving two MPs who have written books about the creation of the coalition – David Laws, a key member of the Liberal Democrat negotiating team (22 Days in May) and Rob Wilson, a Conservative whip at the time, though he talked to players in all the parties (5 Days to Power- the Journey to Coalition Britain). The books are complementary, and largely agree on the main features.

How the Conservatives gained the initiative

A crucial, and largely unappreciated feature at the time, was the rise of the 'Orange Book' generation of younger Lib Dem leaders (Nick Clegg, David Laws, Chris Huhne and Danny Alexander) who were less hostile to the Conservatives in place of the older 'realignment' generation of leaders (Paddy Ashdown, Menzies Campbell and Charles Kennedy) who were instinctively more on the centre-left. That made the Lib Dem leadership more open from the start to  David Cameron’s "big, open and comprehensive offer" on the Friday after the election.

Mr  Cameron in that way gained the initiative which he retained for all but a few hours of the succeeding five days. Gordon Brown was always struggling to keep up and his party, including his own Cabinet, was divided and uncertain about the merits and practicability of a deal.

Mr Laws makes clear how he found the Tory negotiators much more open and flexible than the Labour ones, a point strongly disputed as a partisan rationalisation by many on the Labour side. In many ways, the Tories were hungrier for power almost on any terms than a tired Labour team (with notably exceptions such as Mr Brown himself and Lords Adonis and Mandelson).

The role of the civil service and the Cabinet Manual

The other intriguing factor is the role played by the civil service, not in the talks themselves, where unlike in Scotland in 1999, officials never sat in on the negotiating sessions, but in defining the context in which the talks occurred. Rob Wilson claims that "it is extremely likely that, without the intervention of the civil service, the UK would currently be governed by a Conservative minority government".

Sir Gus O’Donnell, the Cabinet Secretary, published for the first time last February a draft chapter of the proposed Cabinet Manual on 'Elections and Government Formation' (PDF, 126 KB), in particular the conventions on what would happen in a hung parliament.

This reflected wider concern, expressed by the Institute for Government and other constitutional commentators that, unlike the past, a written explanation of the guidelines was necessary in the age of 24 hour news to prevent confusion and to reassure financial markets.

A further, crucial need was to ensure that the Queen remained above such essentially political decisions. These guidelines, reiterating existing conventions, specified that the incumbent Prime Minister could, indeed should, remain in office until it was clear that a successor could command a majority in the Commons. This could involve waiting until the meeting of the new Parliament .

The publication of this draft chapter has been seen as legitimising Brown’s desire to stay in government and to negotiate a possible deal over the five days despite Labour’s heavy electoral losses. Alternatively, it can be seen as giving all parties, but especially Mr Cameron and Mr Clegg, the time to hold talks and agree a coalition.

What if Brown had resigned the day after the election?

If Mr Brown, as the clear loser of the election, had resigned on the Friday after the election, Mr Cameron would have been invited to become Prime Minister. The probability then is that he would have formed a minority government rather than a coalition since there would not have been time to have negotiated with the Lib Dems.

Moreover, by keeping Labour at least nominally in play for most of the five days, Mr Clegg ensured that the Tories conceded that they would take through Parliament a bill to hold a referendum on shifting to the Alternative Vote system of electing MPs. This was vital for the Lib Dems.

Critics allege that Sir Gus also tipped the balance towards a coalition by highlighting market concerns over reducing the Budget deficit, and hence the need for a stable government. But this complaint is unconvincing since it was obvious to all concerned in view of the disturbances in Greece during the election: indeed the Lib Dems declined briefings from the Governor of the Bank of England and the Treasury Permanent Secretary.

As final twist, Mr Brown finally resigned on the Tuesday evening while it was still light – to avoid charges of sneaking away in the dark – when it was still unclear whether a coalition could be formed. However, by then it was abundantly clear that only Mr Cameron could become Prime Minister – even if he had to tell the Queen that evening that he was unsure what sort of government he would be heading.

In my view, the publication of the previously unwritten guidance was not only desirable in itself, to prevent constitutional disputes and market and media confusion, but also allowed all three parties to explore the available options.

Five days may seem a long time to insular British eyes used to instant handovers after an election but it is not a long gap by the standards of virtually every other western democracy (with an average interval of 40 days in the European Union as a whole). We may have to get used to such short intervals if we have more hung parliaments.