UK election: Blair wins but majority slumps

LONDON - Britain's Tony Blair survived widespread opposition to the Iraq war to win a third straight term in power on Friday but saw his majority in parliament drastically reduced.

A chastened prime minister admitted the US-led invasion in 2003 had been a divisive issue and said voters had clearly wanted his centre-left Labour party re-elected with less power.

With most results in, Blair was heading for a majority in parliament of between 60 and 80 seats, sharply down from the 161 last time, an outcome which may hasten his fall, analysts said.

Projections suggested Labour only secured 36 per cent of the vote, an all-time low for a winning party. With 621 results declared by 10.30pm NZT, it had won 353 (down 47 on 2001). The Conservatives had 196 (up 33) and the Liberal Democrats 60 (up 11).

After winning his own seat in Sedgefield, northern England, a sombre Blair said:

"It is not yet clear, obviously, what the majority is. But it seems as if it is clear that the British people wanted the return of a Labour government but with a reduced majority.

"I know Iraq has been a divisive issue in this country but I hope we now can unite again and look to the future."

The result will diminish Blair's authority in his third and last term and his mood contrasted sharply to that when he won landslide victories in 1997 and 2001.

Many Labour Members of Parliament (MPs) will now look to powerful finance minister Gordon Brown, who is waiting in the wings to take over the top job and is now far more popular both in the party and with the public.

ECONOMY

The 54-year-old Chancellor of the Exchequer is widely credited with masterminding the stability of Britain's economy, which has outperformed its European neighbours during the global downturn and was a big vote-winner for Labour.

"Clearly this is a very unpopular government. It has done very badly," said Anthony King, professor of politics at Essex University.

However, Blair has still become only the second premier in British history after Margaret Thatcher to win three elections in a row. He is also the first leader to win three successive terms for Labour, the socialist party founded a century ago and now the dominant force of the British centre-left.

Michael Howard's opposition Conservatives, the once-mighty party of Thatcher and Winston Churchill, face a third consecutive term in opposition.

Analysts said their strategy of homing in on emotive issues like immigration and targeting key winnable seats had paid off to some extent.

Howard conceded defeat in his southern coastal constituency of Folkestone and Hythe, but said: "What has happened on this election day marks a significant step towards our recovery."

Blair, who is 52 on Friday, has been called a liar and a poodle of US President George W Bush over Iraq, and has suffered countless revolts in his own party, but he has refused to apologise for the war which most Britons opposed.

GALLOWAY

He lost at least one loyal MP, Labour's Oona King, solely to Iraq. She was beaten by George Galloway, a radical expelled from the Labour party for attacking Blair over the war, in an east London seat with a large Muslim population.

"All the people you killed, all the lies you told, have come back to haunt you," Galloway told Blair in his victory speech.

"The best thing the Labour party could do is sack you." Blair has already said a third term will be his last, a move critics say will make him a lame duck whose government will be riven by in-fighting between potential successors.

The premier faces a fight to persuade Britons to approve the EU constitution in a promised 2006 referendum.

If Blair's majority ends up much below 70, he also faces the grim prospect of having his legislative plans -- particularly public sector reform -- blocked by a hard core of implacable opponents in his party, still angered by the Iraq war.

"With a majority like this, it will be much harder to push through a radical programme in parliament," said Kevin Theakston, politics professor at Leeds University.

"Power will start visibly seeping through the walls to Number 11 Downing Street to the Chancellor."

A thin majority would also cause jitters on the financial markets. Traders in Tokyo said sterling eased early on Friday.

- REUTERS