As the results of today’s locals elections in England and Wales start to roll in it seems that Gordon Brown’s mandate to run the country may be hanging by a thread. Initial indications are that Labour will lose up to 200 council seats and a whole host of councils. But what does this mean for you? What does this mean for the economy?

The good news is that by sending Labour a very harsh message the voters of the UK are putting great pressure of Gordon Brown to deliver to the voter, with tax friendly policies and assistance for those in real need. The bad news in the short term is that the UK economy has never been as depressed and low for many years and there is no short term fix.

What is the outlook for the Stock Market?

One thing which the stock market dislikes is uncertainty and while the vote in the local elections seems to be indicating a change in government at the next general election, politics has never been that simple. The present government are very unlikely to call an election until 2010 meaning that we effectively have a government ruling the country that does not have a recognisable mandate from the electorate.

Outlook For Taxes

While the Labour government will be looking at every way possible that they can tax the rich and subsidise the poor, their hands are really tied in the short term. They need to the more wealthy of the country to keep the economy going in these difficult times, but they need to reconnect with their core voters and ensure that they have a more comfortable living. Very tricky!

Outlook For Government Policies

The government can now ill afford to push out more and more policies which are being resisted by the masses. We will see more and more Labour MPs fighting back against the government, voting against policies and looking to ensure that they do and say the right things to retain their seats at the next general election.

Outlook For Cost Of Living

This is another area in which the UK government have very little room for manoeuvre, they can’t reduce taxes because they are already running a massive budget deficit and tax income is set to fall further. The possible only chance they have of getting back onside with voters is to force the utility companies to give a little more back to society, but even this will be difficult because the utility companies have had valid reasons to increase prices of late.

Summary

There are many who are expecting a leadership challenge in the summertime as the iron grip which Gordon Brown was once so famous for continues to falter. He has lost the trust of voters, he is losing the trust of his own MPs and he is up against a refreshed and rejuvenated Conservative Party.

Make no mistake, life at Number 10 will be very tough for the next couple of years, if Gordon Brown actually manages to see out his term in office – which to many seems more and more unlikely by the day.