Breaking News: UK exit poll makes Conservatives largest party

LONDON, (Reuters) – An exit poll published after voting ended in the British election today suggested the opposition Conservatives would emerge as the largest party, but fall short of an outright majority in parliament.
The exit poll, which surveyed around 20,000 people out of around 45 million Britons eligible to vote, suggested Britain was on course for its first inconclusive election or “hung parliament” since 1974.
This is likely to keep financial markets under pressure over concerns about complex talks about who should lead the government.
The poll suggested the centre-right Conservatives were likely to win 307 seats and Labour 255 seats in the lower House of Commons, both short of the 326 needed for a majority.
It put the Liberal Democrats, who had been expected to perform strongly, on 59 seats — surprisingly down four on their current number in parliament. Outgoing Prime Minister Gordon Brown would get the first chance to try to form a government under rules governing a hung parliament, but analysts said the most likely scenario was a Conservative minority government led by David Cameron.
“(It will lead to) almost certainly a minority government led by Cameron. Cameron is going to try and get policy programmes into place, demonstrate his competence and then call a second election this autumn or next spring,” said Mark Wickham-Jones, professor of political science, at Bristol University.
However, centre-left Labour, in power since 1997, made it clear it would not relinquish power easily.
“The rules are that if it’s a hung parliament, it’s not the party with the largest number of seats that has first go, it’s the sitting government,” Business Secretary Peter Mandelson said.
The next government will have to deal with a record budget deficit running in excess of 11 percent of national output, and demands for political reform following a parliamentary expenses scandal last year which left Britons disgusted with lawmakers.
Markets were hoping for a clear-cut result and fear that a stalemate could lead to political paralysis, hampering efforts to tackle the nation’s spiralling debt and secure recovery from the worst recession since World War Two.
A series of three U.S.-style leaders’ television debates, a first for UK politics, had energised campaigning and boosted voter turnout.
Conservative leader Cameron saw a commanding poll lead dwindle since the turn of the year, with voters seemingly hesitant about embracing the change his party said they offered after 13 years of Labour rule.
Prime Minister Gordon Brown, who took over mid-term from Tony Blair in 2007, enjoyed a brief honeymoon in the polls but the effects of a grinding recession and an increasingly bloody war in Afghanistan sapped support for him and his Labour party.
The election equation had been complicated by an apparent surge in support for the Lib Dems, helped by strong performances in the TV debates by leader Nick Clegg who shares Cameron’s relative youth — they are both 43 — and easy manner.
Sterling had suffered its biggest one-day drop since last October on Thursday as markets awaited the outcome of the election and fretted over an inconclusive result.
It rose against the dollar as the poll pointed to the Conservatives emerging as the largest party but then fell back within a few minutes.
The Conservatives have promised to cut the deficit harder and faster than Labour and to squeeze out 6 billion pounds ($9 billion) in efficiency savings in the current year.
Labour has warned voters that this could cost jobs and jeopardise the recovery but independent commentators say the figures are tiny compared with a forecast deficit this year of 163 billion pounds ($252 billion).
Independent think-tanks have accused all the parties of failing to be open with voters about the scale of cuts that will be needed to restore public finances.
Exit polls from the last three elections correctly predicted the outcome, but they have not always been accurate. Exit polls in 1992 pointed to a hung parliament but the Conservatives in fact won a majority.

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