A last throw of the dice: Desperate Brown in secret talks with Clegg as Tories teeter on brink of historic Lib Dem deal

  • Lib Dems and Tories to resume talks at the Cabinet Office at 10am
  • Nick Clegg slips into Foreign Office for secret meeting with Brown
  • Cameron warned by Tory Right-wing not to give too much ground
  • Clegg given himself another 24 hours to try to hammer out a coalition
  • Financial markets braced for meltdown this morning

Gordon Brown mounted a secret last-ditch attempt to cling to power last night as the Tories and Lib Dems edged closer to a deal that will see David Cameron enter Downing Street.

Mr Cameron appeared confident of winning Nick Clegg’s support for a belt-tightening economic plan to shore up international confidence in Britain.

Negotiations: Gordon Brown leaves the Foreign Office where he met with Nick Clegg

Negotiations: Gordon Brown leaves the Foreign Office where he met with Nick Clegg

But though the Lib Dem leader had promised to talk to the Tories first about a power-sharing agreement, details emerged of a clandestine meeting between him and Mr Brown in the Foreign Office.

The rendezvous took place just a few hundred yards from the ‘official’ talks between the Tory team and their Lib Dem counterparts.

Labour sources said Mr Brown was mounting a desperate eleventh hour bid to ‘throw a spanner in the works’ and sabotage the Tory-Lib Dem talks.

The horse-trading in Westminster following the first hung Parliament for 36 years took place as:

  • Financial markets were braced for meltdown this morning as Britain was left rudderless, prompting fears that both shares and the pound will take a battering;
  • Mr Cameron was warned by Tory Right-wingers not to give too much ground to the Lib Dems or face open revolt;
  • Mr Clegg – under mounting pressure from his anti-Tory Left wing – was said to have given himself another 24 hours to try to hammer out a coalition agreement with the Tories, before telling them to form a minority government;
  • Chancellor Alistair Darling was powerless to resist an EU deal which could leave taxpayers with a £43billion bill to bail out the failing euro.

Tory and Lib Dem negotiating teams met in the Cabinet Office yesterday for six hours of talks over how to end the political paralysis facing Britain following the uncertain General Election result. They will continue the talks at Whitehall at 10am today.

Over cheese, chicken, beef and egg sandwiches, the teams – led by William Hague for the Tories and Chris Huhne for the Lib Dems – attempted to thrash out a deal that will determine Britain’s future.

The two parties are understood to have identified common ground on deficit reduction measures, taxation, civil liberties and the environment, but the issue of voting reform – totemic for the Lib Dems – remains a significant stumbling block.

The Tories are said to be ready to countenance offering a referendum on changing the electoral system but only after a two-year inquiry and with Tory MPs given a free vote on legislation, making it unlikely to get through the Commons.

The delegations emerged without having reached an agreement, but in an attempt to reassure the markets, said they had agreed economic stability would be key to any deal.

But even as the talks were going on, Mr Clegg slipped into the Foreign Office for his secret meeting with Mr Brown. The Prime Minister ducked out of Downing Street, where he spent the day holed up with Lord Mandelson and Alastair Campbell plotting Labour’s next move, via the back door.

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Talks: Shadow Foreign Secretary William Hague (left) and Shadow Chancellor George Osborne arrive at the Cabinet Office to meet Liberal Democrats

Talks: Shadow Foreign Secretary William Hague (left) and Shadow Chancellor George Osborne arrive at the Cabinet Office to meet Liberal Democrats

David Cameron (left) and Nick Clegg (right) yesterday morning. The Tory leader is confident of winning the Lib Dem's leader's support for a belt-tightening economic plan to shore up international confidence in Britain

David Cameron (left) and Nick Clegg (right) yesterday morning. The Tory leader is confident of winning the Lib Dem's leader's support for a belt-tightening economic plan to shore up international confidence in Britain

The two men had an hour-long discussion. Mr Brown was said to be attempting to trump Mr Cameron’s offer by promising to give more on the issue of electoral reform, and to be ready to offer the Lib Dems up to six seats in the Cabinet if Mr Clegg agrees to prop him up.

Later Mr Cameron and Mr Clegg met again for 30 minutes.

Because no party won an overall majority, the Prime Minister can remain in his post until he decides to resign, but he is facing open demands from his own side to quit at once. Half the Cabinet is understood to have given up hope of clinging to power in a ‘coalition of the losers’, which could include Labour, the Lib Dems, Northern Irish MPs, and Scottish and Welsh Nationalists. And there are increasing signs that many ministers doubt such a deal would be desirable, even if it could be achieved.

‘Why would we want to lead a ragbag coalition with a majority of minus three?’ said one. ‘We must now let the Lib Dems and the Tories stew in each other’s juices, revive ourselves under a new leader and get ready for an election that will probably come sooner rather than later.’

Shadow children’s secretary Michael Gove, one of Mr Cameron’s closest allies, acknowledged that it might not prove possible to form a full coalition with Lib Dem ministers sitting around the Cabinet table, though he said he was ready to give up his place in favour of his Lib Dem counterpart David Laws.

Mr Gove signalled that the most likely outcome is an arrangement that goes further than simply allowing the Conservatives to govern as a minority administration, with the Lib Dems promising not to vote down the Budget or the Queen’s Speech.

Flashpoints that could scupper power sharing

In the wake of David Cameron’s offer of a ‘big, open and comprehensive’ partnership with the LibDems, strategists from the two parties spent the weekend locked in detailed talks.

But there remain significant hurdles to thrashing out even an informal partnership arrangement – let alone a formal coalition, in which LibDems get Cabinet posts.

VOTING REFORM

What the LibDems want: ‘Single transferable vote’ proportional representation, where the number of votes cast translates directly into seats. Cut number of MPs by 150 and lower voting age to 16. Elected Upper Chamber.

What the Tories could swallow: Significant cut in number of MPs, and reform of Lords. Offering an initial committee of inquiry into PR. In extremis, could offer referendum on ‘alternative vote system’, where candidates are ranked in order of preference and losing votes are reallocated until one candidate has more than 50 per cent.

Verdict: Issue on which talks are most likely to collapse. LibDem supporters see this as a unique chance for electoral reform. Tory MPs and grassroots fiercely opposed PR because it could leave UK permanently governed by a centre-Left alliance. A referendum on even watered-down forms of PR would see LibDems and Tories on fiercely opposing sides – risking the coalition.

TAXES

What LibDems want?: Take poorest out of tax system by raising personal allowance to £10,000. Wait until recovery is secure before scrapping NI rise.

What the Tories could swallow: Broad commitment to reducing tax burden on the poor, working towards the £10,000 threshold. Re-think of flagship policy on stopping ‘NI jobs tax’ would be a humiliating U-turn.

Verdict: Grounds for common agreement over personal allowance plan – but not over how it would be paid for. LibDem plans for mansion tax, changes to capital gains tax and a new raid on pension funds unpalatable. Clashes also likely over Tory plan to recognise marriage in tax system, which Mr Clegg has called unfair.

ECONOMY

What LibDems want: Agreement to least halve the deficit by 2014 – but wait until 2011-12 to reduce public spending. Cap public sector pay. Split banks to insulate retail banking from investment risks.

What Tories could swallow: Most of the above, but want to make at least modest cuts in spending this year to reassure the markets they are serious about debt reduction.

Verdict: Shared ground on deficit reduction most likely basis for agreement. Locking LibDems into a partnership would help Mr Cameron, by silencing a respected opponent in Vince Cable. If coalition talks collapse, LibDems could agree to support Tory cuts package in informal ‘confidence and supply’ arrangement.

CABINET POSTS

What LibDems want: As many as possible. Eyeing Treasury, Home Office, Education and Leader of Commons posts among others. At the least, want jobs for Mr Clegg, Mr Cable and former leadership contender Chris Huhne.

What Tories could swallow: Prepared to let key figures join cabinet. Schools spokesman Michael Gove yesterday said he would give up his own post to a LibDem. Could hand Mr Cable a key role on a financial stability committee if not a Treasury job.

Verdict: A formal coalition demands ministerial roles – but Mr Cameron’s red-line policy issues on immigration, Trident and the EU make a LibDem in the Foreign Office, MoD or Home Office an unthinkable prospect. Lib-Dems could also refuse to work with Shadow Chancellor George Osborne, Mr Cameron’s closest political ally.

EDUCATION

What LibDems want: ‘Pupil premium’ giving schools extra funding for teaching children from disadvantaged backgrounds. Scale back tests at age 11. Scrap top-up fees

What Tories could swallow: Agree with pupil premium policy. Stop short of scrapping SATs tests but could agree to greater internal assessment instead of formal end-of-year exam.

Verdict: Along with economy, greatest scope for a deal. Tories would face struggle to convince LibDems of merits of allowing parents to establish own ‘free’ schools. Clashes also likely on top-up fees, which Tories may even allow to increase. Outside of a coalition, LibDems could agree to back a Tory Education Bill.

PM’S FAMILY BREAK FROM THE ACTION

He may have been fighting for his political life but Gordon Brown’s family appear to have enjoyed a relaxing weekend away from it all. Yesterday started with a trip to the Prime Minister’s local church in Queensferry near their constituency home in Fife.

Smiling at the waiting media, he led his wife Sarah into the church but refused to answer reporters’ questions about whether he should resign.

Gordon Brown and his wife Sarah leave church (left) and walk around North Queensferry in Fife, yesterday

Gordon Brown and his wife Sarah leave church (left) and walk around North Queensferry in Fife, yesterday

Afterwards Mrs Brown told her followers on Twitter: ‘Had lovely 24-hour family break in Scotland, glass of wine, sort-of a lie-in, good to see many Fife friends at local church.’

When Mr and Mrs Brown returned to Downing Street with their two young sons, John and Fraser, they looked like any other family enjoying a Sunday stroll.

Then it was business as usual for Mrs Brown who wished her Twitter followers a ‘Happy Mother’s Day for those in the USA’.

source: dailymail.co.uk

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