Theresa's party suffers loss, but set to form govt

British Prime Minister Theresa May said she would form a government backed by a small Northern Irish party after her Conservative Party lost its parliamentary majority in an election. 

Theresa said on Friday the government would provide certainty and lead Britain in talks with the European Union to secure a successful Brexit deal. 

But with her authority diminished, Theresa risks facing more opposition to her Brexit plans from both inside and outside her Conservative Party, and some colleagues may be lining up to replace her. 

“She’s staying, for now,” a party source told Reuters. 

Theresa said she could rely in parliament on the support of her “friends” in northern Ireland’s Democratic Unionist Party (DUP) after her governing Conservatives failed to emerge as clear winners. The DUP only said that it would enter talks. 

“The prime minister has spoken with me this morning and we will enter discussions with the Conservatives to explore how it may be possible to bring stability to our nation at this time of great challenge,” Democratic Unionist Party leader Arlene Foster told reporters. 

Confident of securing a sweeping victory, Theresa had called the snap election to strengthen her hand in the European Union divorce talks. But in one of the most sensational nights in British electoral history, a resurgent Labour Party denied her an outright win, throwing the country into political turmoil. 

EU leaders expressed fear that Theresa’s shock loss of her majority would delay the Brexit talks, due to begin on June 19, and so raise the risk of negotiations failing.  “Do your best to avoid a ‘no deal’ as result of ‘no negotiations’,” Donald Tusk, leader of the EU’s ruling council, wrote in a tweet. 

With 649 of 650 seats declared, the Conservatives had won 318 seats and Labour 261 followed by the pro-independence Scottish National Party with 34. Theresa’s left-wing Labour rival Jeremy Corbyn, once written off by his opponents as a no-hoper, said she should step down and he wanted to form a minority government.
 

But Theresa, facing scorn for running a lacklustre campaign, was determined to hang on. Just after noon, she was driven the short distance from Downing Street to Buckingham Palace to ask Queen Elizabeth for permission to form a government — a formality under the British system.  The pound hit an eight-week low against the dollar and its lowest levels in seven months versus the euro before recovering slightly on news that she would form a DUP-backed government.  The centre-right DUP’s 10 seats are enough to give the Conservatives a fragile, but workable partnership. 

“Our two parties have enjoyed a strong relationship over many years and this gives me the confidence to believe that we will be able to work together in the interests of the whole UK,” Theresa said.  This was likely to involve a deal in which the DUP would support a Conservative government on key votes in parliament, but not form a formal coalition.  With the complex talks on the divorce from the EU due to start in 10 days, it was unclear what their direction would now be and if the so-called ‘Hard Brexit’ taking Britain out of a single market could still be pursued.