Gordon Brown quits as PM as Lib-Dem deal falls apart

Gordon Brown is set to resign tonight and allow David Cameron to be Britain’s new Prime Minister. The Labour leader’s final desperate attempt to cling on to power with a Lib-Lab deal crumbled amid a rebellion on his own side and policy disagreements with Liberal Democrat leader Nick Clegg.

This afternoon he retreated to No 10 to discuss his situation with senior ministers, friends and wife Sarah.

Mr Brown had planned to stay in power until the summer if the deal had worked, earning himself a place in history as the man who won a historic fourth term for Labour.

However, Labour MPs and ministers reacted with anger to the attempted deal, saying they would prefer to be in opposition than in government with the Lib-Dems.

A friend of the Prime Minister said: “The deal with Clegg was just not do-able.”

Talks with Mr Clegg’s team took place this morning but lasted less than two hours. Mr Clegg then reopened talks with the Conservatives, amid speculation that a Lib-Con deal was imminent.

Labour’s public turmoil had left Mr Clegg exposed and under massive pressure to make up his mind one way or the other. He was likened to a “harlot” by former home secretary David Blunkett and accused of “Robert Mugabe politics” by former Tory foreign secretary Sir Malcolm Rifkind.

Although Mr Cameron ordered his team not to join in the name-calling, the Conservative leader upped the pressure on Mr Clegg by insisting it was “decision time”. Leaving home this morning, he said: “It’s now, I believe, decision time — decision time for the Liberal Democrats. And I hope they make the right decision to give this country the strong, stable government that it badly needs and it badly needs quickly.”

In today’s developments:

A series of big-name Labour figures, including Health Secretary Andy Burnham and Mr Blunkett, said Mr Brown should admit Labour had lost.

The Labour leadership race gathered pace despite Mr Brown’s edict against open campaigning, with Ed Miliband emerging as a dark horse.

Lib-Dem peers told Mr Clegg they thought only the Conservatives could deliver stability, while respected Treasury spokesman Vince Cable signalled he could work with Tory plans to cut spending this year.

Most Conservative MPs endorsed Mr Cameron’s offer of policy concessions and a referendum on the alternative vote system for future elections, although the Right-wing Conservative Way Forward group urged him to break off the talks.

Labour were today said to have offered the Lib-Dems a referendum in the next parliament on full proportional representation, as well as the alternative vote system in this one.

But the Lib-Dem team were understood to be doubtful that a Labour leader could deliver on the pledges and dismayed that the Government was unwilling to give concessions on civil liberties issues.

Most Lib-Dem MPs contacted by the Standard favoured a pact with the Conservatives. Simon Hughes was a notable exception.

Mr Clegg has seen his squeaky clean image badly tarnished in the past 24 hours after he asked the Prime Minister for talks while appearing to be on the brink of a deal with Mr Cameron.

Sir Malcolm said that looked “duplicitous” and went on: “This is straight out of the Robert Mugabe school of politics. You lose and then cobble together some formula to keep power.

Last ace up Gordon Brown’s sleeve is his power to go to the Queen

If David Cameron had a free choice he might well tell Nick Clegg to take a running jump into the Thames.

A minority Conservative government is perfectly credible and could dare opponents to vote down its Queen’s Speech and Budget, knowing that any party leader who force-feeds the British public another election will not be lightly forgiven.

Tory MPs would cheer their leader to the rafters if he ended the grubby-looking auction for Mr Clegg’s favours. And Mr Cameron could always copy Harold Wilson and call another election if he felt in six months or a year’s time he could obtain a full majority.

However, there is an extraordinary stumbling block in his way, which forces him to continue being polite to Mr Clegg. To form a government, Mr Cameron has to be invited to do so by the Queen. The Queen, however, will only summon him if she is advised to do so. And the person who is constitutionally tasked to give her that advice is none other than Gordon Brown.

In other words, Mr Brown can keep the auction going if he thinks it could keep Labour in power or squeeze more concessions from the Conservatives. It cannot carry on for ever, though. The ultimate deadline would be May 25, the day of the State Opening, because Mr Brown is far short of the support to win a vote on a Queen’s Speech.

But nobody dares wait until then. As a senior Tory remarked: “A few more days of this, and the next government of Britain may be the IMF.”