DAVID Cameron has held out what he calls a "big, open and comprehensive offer" to the Liberal Democrats to work together in government.

In a statement in Westminster, he acknowledged that there would have to be reform of the electoral system and he proposed the creation of an all-party committee of inquiry to look at the issue.

As a major carrot to attract Lib Dem support, Mr Cameron offered an all-party committee of inquiry on political and electoral reform to look at the possibility of changing Westminster's first-past-the-post voting system.

But he stopped short of promising the immediate legislation on a referendum on voting reform offered by Prime Minister Gordon Brown less than an hour earlier.

In a statement outside the door of Number 10, Mr Brown said he respected Mr Clegg's decision to talk first to Conservative leader David Cameron on a possible coalition, but stressed that Labour and the Lib Dems shared "common ground" not only on voting reform but also on the economy.

The PM made clear he did not expect a swift conclusion to the uncertainty surrounding the result of yesterday's election, stating that negotiations between the parties could be "prolonged".

In a sign that Labour remains very much in power for the time being, he revealed that Chancellor Alistair Darling will take part in conference call talks today with fellow G7 finance ministers on the crisis in the euro area.

Mr Brown said he was ready to see any of the other party leaders about the way forward.

He was speaking after Mr Cameron had been effectively offered the keys to 10 Downing Street by Mr Clegg who said that the Conservatives had the "first right" to seek to form a government in Britain's first hung Parliament since 1974.

Tories do not have the voting strength to maintain an outright majority in the new House of Commons, but may hope to govern as a minority administration with support from Northern Irish unionists, rather than offer the electoral reform that is likely to be an essential condition of any deal with the Lib Dems.

Mr Cameron insisted that Labour had ''lost its mandate to govern our country'', as his party raced ahead in terms of seats won in the new Parliament.

With twoseats left to declare, the Conservatives had 307 MPs, with Labour on 258 and the Lib Dems on 57. None of the parties was able to reach the 326 threshold for outright victory.

Meanwhile the local election counts for councils in Southampton, Eastleigh, Fareham, Gosport and Winchester were taking place today.

GENERAL ELECTION RESULTS


• Southampton Itchen
• Southampton Test
• Romsey & Southampton North
• Winchester
• Eastleigh
• Fareham
• Gosport
• Meon Valley
• New Forest West
• New Forest East

Check HERE for the latest local election results.