UPDATE 2-UK’s Cameron says coalition will defy doubters

* British PM Cameron: new coalition will prove critics wrong

* Two sides have joint plan to tackle record budget deficit

* First signs of dissent over changes to parliament’s rules

* Foreign Secretary Hague to meet Clinton in Washington

(Updates after new Cameron press conference)

By Peter Griffiths

LONDON, May 14 (BestGrowthStock) – Britain’s ruling coalition
partners will provide a strong, lasting, stable government that
will take early action to cut the country’s record budget
deficit, Prime Minister David Cameron said on Friday.

Cameron, who took power this week after 13 years of Labour
rule, said he would be able to maintain his power-sharing deal
with the smaller Liberal Democrats despite the pressing need for
public spending cuts and tax rises.

Political rivals, analysts and even some within Cameron’s
own centre-right party have raised concerns the two sides’
political views are too far apart for the coalition to succeed.

But Cameron, who travelled on Friday to Scotland where his
party has only a single lawmaker, said his alliance with the
centre-left Liberal Democrats would defy the sceptics and grow
in strength during its scheduled five-year term.

“I think having a government that can last for five years
with two parties who have put aside their differences for the
national interest and the common good raises exciting
possibilities for our whole nation of trying to solve our big
challenges, confront our big problems and actually provide good,
strong, stable government,” he told reporters in Edinburgh.

Unlike many other European countries, Britain is not used to
coalition governments — this is its first since 1945 — and the
divisions between the main parties are deep and historic.

“FALSE DAWN”

A former Conservative deputy prime minister, Michael
Heseltine, predicted the inevitable spending cuts would cause
“terrible strains” in the coalition.

“We are living in a false dawn,” he was reported as saying
in the Independent newspaper. “The sun is shining. It is not
going to last very long … there is a rocky road ahead.”

The first signs of dissent surfaced over Cameron’s proposals
to change the way parliament can vote to remove a government if
it proves unpopular during its five-year term.

Under the plan, Britain would have fixed-term parliaments,
ending the prime minister’s right to decide the timing of an
election. Any vote on dissolving a parliament mid-term would
need the support of at least 55 percent of lawmakers.

“I’m the first prime minister in British history to give up
the right, unilaterally, to ask the queen for a dissolution of
parliament. It is a big giving-up of power,” Cameron said.

“If you want a fixed term parliament, you have to have a
mechanism to deliver it.”

Critics say the change is unconstitutional and would give
the coalition too strong a grip on power as it has 56 percent of
the seats in parliament.

The coalition’s most pressing task is to cut the budget
deficit running at more than 11 percent of GDP.

Britain is emerging from the worst recession since World War
Two but the new government is under pressure to reduce public
spending and raise taxes to balance the books.

On Wednesday Bank of England governor Mervyn King backed the
coalition’s fiscal plans but said urgent action was needed.
[ID:nLDE64B187]

“The governor of the Bank of England this week gave the
clearest possible sign that the dangers of inaction were much
greater than the dangers of action,” Cameron said.

“He said substantial action and some early action was
essential. The advice for the treasury seems to be the same,
that is why action should be proceeded with.”

Finance minister George Osborne is expected to set out tax
and spending plans in an emergency budget in the next few weeks.

New Foreign Secretary William Hague, a former Conservative
leader who lost to Tony Blair in the 2001 election, will meet
his U.S. counterpart Hillary Clinton in Washington. [nLDE64C0YO]

“Our immediate priorities are making sure that we get to
grips with Afghanistan and tackling nuclear proliferation (in)
Iran,” Hague told the Times newspaper.

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(Additional reporting by Michael Holden; Editing by Myra
MacDonald)

UPDATE 2-UK’s Cameron says coalition will defy doubters