MUCH talk recently has focused on the growing prospect of a hung Parliament after the forthcoming general election.

The Conservatives’ lead in opinion polls has narrowed, which is why we’ve seen David Cameron wooing Ulster’s various Unionist parties.

A hung Parliament would be a new experience for younger generations. The last hung Parliament occurred in 1974. Since then, both Jim Callaghan and John Major endured wafer- thin majorities, but for most of the past three decades Britain has been governed by strong majorities.

The fear has to be that an indecisive outcome at the next election would lead to political instability and weak government, with horrendous consequences for the economic management of the country. 

It can be no coincidence that Britain suffered from poor economic performance during the early 1970s, but enjoyed its biggest booms when it had strong and stable governments led by Margaret Thatcher and Tony Blair.

Back in 1974, inflation was 16% and rose to almost 25% a year later. The stock market crashed and the economy was in recession, with output falling 1.1% in 1974.

As well as much lower inflation, another big difference between the days of the Lib-Lab pact and now is that Labour has undergone a significant shift to the right.

The modern-day New Labour party has dropped the socialist agenda from its constitution and instead embraced the market economy. Prior to coming to power in 1997, Mr Blair and his front bench team spent a lot of time cosying up, not to the trade unions, but to the financiers in the City.

Labour has moved closer to Conservative policy on the economy, leaving the Liberal Democrats to occupy the centre-left ground.

Arguably, therefore, if parties were to form alliances to enable them to form a government in the event of a hung Parliament on the basis of their political alignment, the deal most likely to produce the largest amount of common ground would be a Conservative-Labour pact.

Neither of the two major parties have much in common with the Liberal Democrats, a party keen to raise personal taxation, offer free personal care for the elderly and generally pursue a vote-losingly ambitious left-wing agenda.

The gap between the two biggest parties and the Liberal Democrats is so great that it is hard to see any form of coalition involving them as having any longevity to it.

As a result, any coalition involving the Lib-Dems would see the big issues like restoring Britain’s public finances to health put off while parties bickered and fresh elections called were for.

The British economy would miss out as rival nations took full advantage of the return to global economic growth. A hung Parliament would be the worst possible election outcome.

ANOTHER disappointing set of figures from BP yesterday, as the oil giant published its fourth-quarter trading figures.

The company has had a bad time in the last few years, with safety problems at US oil refineries and the loss of its chief executive Lord Browne.

Prospects for its turnaround strategy will now depend on how quickly the global economy picks up.