LONDON — A short honeymoon — and many a headache — await British Prime Minister David Cameron as he reshuffles his cabinet following the Conservative Party’s shock majority victory in the country’s general elections on Thursday.
Over the next 100 days, Cameron is looking to redefine Britain’s relationship with the European Union and abolish the controversial Human Rights Act; push through welfare cuts in an ongoing austerity program, and deal with growing cries for Scottish independence.
The numbers are certainly working in the re-elected Prime Minister’s favor: On Thursday, Conservatives defied pre-election polls to win a majority of seats in what was widely projected to be a hung parliament. The party, which now holds 331 of the 650 seats in parliament, is no longer beholden to its former coalition partners, the Liberal Democrats who, like the Labour Party, suffered a wipeout in the polls.
In a speech outside No. 10 Downing Street on Friday, Cameron pledged to “bring our country together. We will govern as a party of…one United Kingdom. That means ensuring this [economic] recovery reaches all parts of our country, from north to south, from east to west. The government I led did important work. It laid the foundations for a better future and now we must build on them,” he said.
Victory may have been sweet, but Cameron now has a number of bitter battles on his hands: On Saturday, police in riot gear arrested 15 protestors during an unscheduled demonstration against the Conservatives’ austerity program. Hundreds of antigovernment protestors, anticipating Cameron’s deep cuts to welfare, marched from Conservative Party headquarters in Westminster to Downing Street carrying posters that read “Get the Tories Out!” and “I Pledge to Resist.” They also vandalized a war memorial, scrawling “Tory Scum” on it as the country marked the 70th anniversary of V-E Day, the end of World War II in Europe.
The prime minister will also have to deal with reducing the deficit, funding the country’s creaking National Health Service, and coping with demands for a more powerful and independent Scotland. Nicola Sturgeon’s Scottish National Party is on a mission to break away from the U.K. — despite losing an independence referendum last fall — and is now a potent force in parliament. The left-wing party secured 56 seats in an historic landslide victory, and their ultimate aim is to see Scotland stand alone.
Cameron also plans to seek changes that would redefine Britain’s relationship with the EU, giving his country more independence with regard to laws and law-making, and putting curbs on the benefits that EU migrants are entitled to once they land on British shores. He plans to hold an in/out referendum on whether Britain should remain in the EU, by the end of 2017.
His government plans to abolish the Human Rights Act, part of the EU Convention on Human Rights, which allows human rights cases to be heard in U.K. domestic courts rather than at the European Court of Human Rights. Scrapping the act will mean that illegal migrants, criminal foreign nationals and others facing deportation from Britain will have fewer grounds to appeal. Those who oppose the act see it as a loophole that criminals use to remain in the U.K. and collect benefits.
On Friday, markets cheered the election’s results: Europe’s main indices all notched strong gains at the end of trading, with the FTSE 100 in London up 2.3 percent to 7,046.82; the DAX in Frankfurt 2.7 percent to 11,709.73; the CAC 40 in Paris 2.5 percent to 5,090.39; and the FTSE MIB in Milan 2.1 percent to 23,312.43. The pound rocketed upward on the result, rising 1.4 percent against the dollar Friday evening to $1.55.
In the run-up to the election, retailers and fashion executives came out in favor of the Conservatives, who are pro-business, and who’ve helped to kick-start the economy during their six-year tenure. Last month, 100 business leaders signed a love letter to the Tories that was published in The Daily Telegraph. The letter warned that a Labour government, by contrast, would “threaten jobs and deter investment.”
Signatories included leaders in fashion, luxury and retail such as Robert Bensoussan, the investor and chief executive officer of L.K. Bennett; Neil Clifford, ceo of Kurt Geiger; investor Mark Esiri; designer Anya Hindmarch; Ray Kelvin, founder and ceo of Ted Baker; Jonathan Newhouse, chairman and ceo of Condé Nast International; George Weston, ceo of Primark’s parent Associated British Foods; Nick Robertson, founder and ceo of Asos.com, and Stuart Rose, the investor and former chairman and ceo of Marks & Spencer.
The country’s big retail and business organizations, meanwhile, did not take a public stance on the election, but stressed that any new government needed to keep commerce flowing.
Months ago, the British Chambers of Commerce described the general election as “the most wide-open contest in decades, generating huge nervousness among British businesses,” and asked all political parties to create “policies that deliver prosperity” and a nation that trades with confidence “recapturing some of the mercantile spirit of our past.”
It was clear many Britons voted Thursday with their wallets: The economy is now growing, albeit modestly, and consumer confidence is on the rise. According to the latest Consumer Tracker from Deloitte, the business advisory firm, consumer confidence around household disposable income was at its highest in more than three years in the first quarter.
“With the recent return to real wages growth and further falls in unemployment, consumer finances are starting to normalize,” said Ian Stewart, chief economist at Deloitte. “This points to an acceleration in consumer activity and suggests 2015 may well be the best year for consumer spending since 2005.”