In order to remain in office, Prime Minister James Callaghan approached the Liberal Party, at the time led by David Steel.
Former Foreign Secretary Callaghan had been Prime Minister for just one year, having succeeded Harold Wilson who had led Labour to a three-seat majority at the October 1974 general election.
The Lib–Lab Pact's end was confirmed on 7 September 1978,[1] by which time Callaghan was expected to call a general election, but instead he decided to remain as leader of a minority government.
Blair was still considering attempting to form a coalition government with the Liberal Democrats on the day of the general election, until the full scale of his Labour Party's majority became clear at 03:05 on the morning of 2 May 1997; ending eighteen years of Conservative rule.
[2] Encouraged by former SDP leader Roy Jenkins, Blair still considered bringing the Lib Dems into the Cabinet after his election victory, as he believed this would help to create a political realignment on the centre-left and usher in a period of left-wing unity, and only reneged after Deputy Prime Minister John Prescott threatened to resign over the issue in 1998.
Press rumours of a possible Lib Dem–Labour deal were publicised, with Prime Minister Gordon Brown alleged to be willing to offer to legislate for a change to the alternative vote system, followed by a referendum on proportional representation, if an arrangement that would keep him in government could be agreed.
[6] A coalition of Labour, the Liberal Democrats, the SDLP, Plaid Cymru, the Alliance Party of Northern Ireland and the Green Party—a "rainbow" or "traffic light" coalition—would have been needed to give a working majority of one.
There was a significant level of hostility to such a deal within the Labour Party, with coalition proposals being opposed by, among others, former Cabinet ministers John Reid and David Blunkett.
[9] Nick Clegg stated his opinion prior to the 2010 general election that the party which wins the most seats but fails to get an absolute majority in the house has the right to attempt to form a government first, either on their own or in a coalition.
Senior members of Miliband's team, including Lord Adonis, the former Cabinet minister, had been urging him privately to prepare for fresh coalition negotiations after the 2015 general election because opinion polls suggested no party would win an outright majority in 2015.
[15] However, neither a coalition nor a pact between the Lib Dems and Labour was possible, following the Conservatives winning a majority at the 2015 general election and the loss of 49 Liberal Democrat seats.
[18] On 13 June 2023, Labour Party National Campaign Coordinator Shabana Mahmood ruled out a Lib–Lab pact in the by-elections in Mid Bedfordshire, Uxbridge and South Ruislip and Selby and Ainsty.
Whilst not a pact, ahead of the 1997 election Labour Leader Tony Blair and Lib Dem leader Paddy Ashdown set up the Labour-Liberal Democrat joint committee on constitutional reform to discuss devolution in Wales and Scotland, and led to Prime Minister Tony Blair setting up a joint Lib–Lab cabinet committee.