British Prime Minister Gordon Brown indicated Friday he might attempt to form a coalition government, seeking to keep his Labour Party in power following an election in which the Conservatives were projected to claim the most seats but not get a majority in Parliament.
The exit polls reflected uncertainty over who will form the next government and Britain's top three parties — the Conservatives led by David Cameron, Labour and the Liberal Democrats — immediately began jockeying to form alliances.
Speaking in his home district in Scotland, Brown vowed to "play my part in Britain having a strong, stable and principled government" — the clearest sign yet that he would try to cling to power and seek an alliance with the third-place Liberal Democrats. Brown also pledged action on election reform — a key demand of his would-be partners.
Turnout for Thursday's vote appeared to be high and hundreds of people across the country were prevented from voting when polls closed at 10 p.m. The head of Britain's Electoral Commission said legal challenges to some ballot results were likely from those turned away.
Police had to go to one polling station in east London after 50 angry residents who were denied the chance to vote staged a sit-in protest. Voters in Sheffield, Newcastle and elsewhere in London also complained that they had been blocked from voting.
An analysis by Britain's main television stations suggested the Conservatives will win 305 of the 650 House of Commons seats, short of the 326 seats needed for a majority. Labour was seen winning 255 seats and the Liberal Democrats 61, far less than had been expected after their support surged during the campaign.
If the projections stand, political wrangling and uncertainty is ahead for one of the world's largest economies — a prospect that could unsettle global markets already reeling from the Greek debt crisis and fears of wider debt contagion in Europe.
Before the vote, a somber warning came from the European Union: Britain's budget deficit is set to eclipse even that of Greece next year. Whoever winds up in power faces the daunting challenge of introducing big budget cuts to slash Britain's huge deficit.
Initially, the British pound sank to its lowest point in a year at $1.4715, but later recovered ground, and UK government bonds also rallied in the hope that the Conservatives might manage to form a government.
In London, bond trading started in the middle of the night — six hours earlier than normal — as traders tried to capitalize on early forecasts.
Conservative leaders were adamant that the results meant Brown must go — but senior Labour figures lost no time in reaching out to the Liberal Democrats in hopes of blocking Cameron.
Business Secretary Peter Mandelson of Labour noted that in a "hung parliament" — one in which no party has a clear majority — the sitting prime minister is traditionally given the first chance to form a government.
He extended an olive branch to the Liberal Democrats, who have called for an end to the existing system in which the number of districts won — not the popular vote — determines who leads the country.
"There has to be electoral reform as a result of this election," Mandelson said. The current system, he said, "is on its last legs."
But such a coalition might still not work because the projections showed those two parties combined might still fall short of a majority. The gambit would also risk alienating many in Britain, a country without a constitution where political maneuvers are often governed by informal convention.
The television projections showed the Labor Party with its smallest number of seats since 1987. The Conservatives, widely known as the Tories, appeared to gain 95 seats, all but one at the expense of Labour.
Theresa May, a senior Conservative Party lawmaker, said Brown had lost "the legitimacy to govern."
"No way this man, who has failed this electoral task, can contemplate forming a government," Conservative Party chairman Eric Pickles said.
The biggest surprise of the night was the apparently poor performance of the upstart Liberal Democrats, whose telegenic leader Nick Clegg had shot to prominence on the back of stellar debate performances and had been expected to play the role of kingmaker. Instead of breaking out of perennial third-party status with strong gains, the party was projected to remain about even with earlier results.
Robert Worcester, an analyst for pollster IPSOS Mori, said the Liberal Democrats' poor showing could be attributed to a low turnout by their supporters. "They said they would vote and they didn't," he said.
Liberal Democrat deputy leader Vince Cable described the exit poll as "very strange" and insisted projections based on them had been "horribly wrong" in the past.
Projecting elections based on exit polls is risky — particularly in an exceptionally close election like this one. Polls are based on samples — in this case 18,000 respondents — and always have some margin of error.
Britain's census is nine years out of date and the polling districts haven't caught up to population shifts. Many voters also refuse to respond to exit polls.
In addition, thousands have also already cast postal ballots but those results don't factor into the exit polls. About 12 percent cast postal ballots in 2005.
Some early indications suggested that the Conservatives may have a chance at defying exit polls and winning a majority. Official results showed large swings to the Cameron camp in a few key constituencies in the normally Labour-dominated northeast. But the Conservatives failed to capture other key targets in central and southern England — an indication that predictions no party will claim a majority are correct.
Political experts say the Conservatives need a nationwide swing in their favor of about 7 percent to clinch a majority. Though the Tories made inroads of closer to 9 percent in some districts, in others they scored swings of 5 percent or less.
Still, Cameron appears to have a considerable chance of return the party of rightwing icon Margaret Thatcher to power after 13 years in the political wilderness — even though he may have to seek deals with Irish nationalists or others.
In theory, a majority requires 326 seats. However, in practice Cameron could govern as a minority government with a dozen or so fewer because of ad hoc alliances he could form for key votes, and the fact that some parties would be unlikely to join a discredited Labour camp.
The Conservatives were ousted by Labour under Tony Blair in 1997, after 19 years in power. Three leaders and three successive election defeats later, the party selected Cameron, a fresh-faced, bicycle-riding graduate of Eton and Oxford who promised to modernize its fusty, right-wing image.
Under Brown, who took over from Blair three years ago, Britain's once high-flying economy, rooted in world-leading financial services, has run into hard times. The nation creaks under mountains of public debt and fears are rife that Greece's financial crisis could spread and infect the United Kingdom. That could unsettle global markets as well.
Despite the uncertainty, California Gov. Arnold Schwarzenegger — a known supporter of Cameron — said on his Twitter feed he'd already called the Tory leader to congratulate him. "Even though results aren't in we know the Conservatives had a great day," Schwarzenegger wrote.
Associated Press Writers Raphael G. Satter, Jill Lawless and David Stringer contributed to this report.
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