1.00am: That's it. Britain has got its first coalition government for more than 60 years. And Nick Clegg will be sitting in cabinet alongside Liam Fox and William Hague. Will it work? Who knows. But it is a bold project, and it will be certainly be interesting. We'll get our first good look at it tomorrow (rather, later today) when the Cameron cabinet is expected to meet for the first time. And we've also got a new (interim) Labour leader. And the Labour leadership contest will soon begin in earnest.
12.56am: Here is the full text of Clegg's speech.
Tonight the Liberal Democrat parliamentary party and the federal executive of Liberal Democrat party have overwhelmingly accepted my recommendation that we should now enter into a coalition government with the Conservative party.
Before I say anything more about that coalition government I would like to express my thanks and admiration for Gordon Brown. He has been a towering figure for more than a decade in British politics and the manner in which he has acted over the last few days has displayed immense dignity, grace and a profound sense of public duty.
We are now going to form a new government, more importantly we are going to form a new kind of government. I hope this is the start of the new politics I have always believed in: diverse, plural, when politicians of different persuasions come together to overcome their differences in order to deliver a good government for the sake of the whole country.
That was what we were asked to do by the people of Britain at the general election last week, and that is now what we will seek to deliver.
I would like to thank David Cameron for the very positive, constructive and workman like way in which we have been able to reach a basic agreement on how we can come together in this new coalition government over the last few days. We are politicians, clearly of different political parties, but I believe we are now united in wishing to tackle the challenges this country faces and to deliver a fairer better Britain, and I look forward to working with him to do just that.
There will of course be glitches. But I will always do my best to prove that new politcs isn't just possible, it's also better.
I would like to say something directly to the nearly 7 million people who supported the Liberal Democrats in the general electoin last week. I am acutely aware that I carry your hopes, your aspirations with me into this coaltion. I can imagine this evening that you will be having many questions, many many doubts about this new government. But I want to assure you that I would not have entered into this agreement if I had not been genuinely convinced that it offers a unique opportunity to deliver the kind of change which you and I would like to see: fairer taxes; a fair start in life for every child in this country; a new start for our discredited banking system and the prospect of new, sustainable growth in our economy; and a new hopeful politics that you can trust once again.
So I hope you will keep faith with us, I hope you will let us prove to you that we can serve you and this country with humility, with fairness at heart of everthing we do, and with total dedication to the interests and livelihoods of everyone in Great Britain. Thank you.
12.16am: My colleague Hélène Mulholland has been compiled an analysis of the policies agreed by the coalition. This is a long post, but it is effectively the manifesto for the coalition government, the agenda for the next five years, and so it is worth posting in full.
Economic measures for an agreement which has deficit reduction "at its heart"
• £6b in year cuts in non frontline services subject to the advice from the Treasury and the Bank of England (Tory)
• Scrapping of national insurance rises (Tory)
• A substantial increase in the personal tax allowance from April 2011 with a focus on low and middle income earners, with a "long term goal" of a £10,000 personal tax allowance. There is no a timetable for this, but there is a promise to make further real term steps each year towards this objective. This is described as a "funded increase". It will be funded by taking the money the Tories had planned to use to increase the employee threshold for national insurance, and by an increase in capital gains tax for non business assets to bring it closer to the level of income tax.
• Marriage tax allowance. The liberal democrats have agreed to abstain on this, which gives the Tories a "real chance" of getting that through.
Lib Dem pledges that have been dropped
• Tax relief for higher rate pensioners will not be pursued
• Mansion tax
Tory pledges that have been dropped
• Raising the threshold on inheritance tax which is described as "unlikely to be achieved in this parliament".
Lib Dems priorities that have been secured
• Referendum to bring in some form of alternative vote system. Coalition members will be subject to three-line whip to force the legislation for a referendum through, but they will be free to campaign against the reforms before referendum.
• New pupil premium to be introduced, steering more funding to schools for every child they take from poor homes. Both parties back this policy, but the Lib Dem version attaches more money to it.
• Reducing the tax burden on low earners. This could go some way towards the Lib Dem aim of lifting tax threshold to £10,000.
• A wholly or mainly elected house of Lords.
• More equal constituency sizes
• Fixed term parliaments, including this one. The next general election will be held on the first Thursday of May 2015. Legislation will mean such agreements can only be broken by an enhanced majority of the House of Commons.
Tory priorities that have been secured
• A cap on immigration and an end to child detention immigration controls (the latter was a Lib Dem proposal).
• Welfare reform programme to be implemented in full.
• School reform programme providing all schools are held accountable.
• A commitment to maintaining Britain's nuclear deterrent. Renewal of Trident will be scrutinised to ensure value for money. Liberal Democrats will be free to continue the case for alternatives.
• The government will make no proposals to join the euro.
• No proposals to transfer new powers to the European Union.
• A referendum lock will ensure that any proposal to transfer new powers must by law be put to a referendum.
Areas that were already in agreement will see a major programme of civil liberties
• A great repeal or freedom bill to scrap the ID card scheme and the national identity register and the next generation of biometric passports
• Extending the scope of the Freedom of Information bill to provide greater transparency
* Adopt protections of the Scottish model for the DNA database
• Protecting trial by jury
• Reviewing libel laws to protect freedom of speech
• Further regulation of CCTV and other items
• Measures to boost economy in key areas such as low-carbon industries and investment in infrastructure. A green investment bank, a smart grid, retention of energy performance certificates while scrapping home information packs.
Areas of opt outs for either party
• Lib Dems will be free to maintain their opposition to nuclear power while permitting the government to put forward the national planning statement for ratification by parliament so that new nuclear construction becomes possible.
• A banking levy will be introduced.
• Bonuses will be tackled.
• A "more competitive banking industry".
• More credit to flow to businesses. The proposals of the respective parties will be looked at before deciding which is the better one.
• An independent commission will be set up to consider Lib Dem proposals to separate retail and investment banking and the Tories' proposals for a quasi separation. An interim report will be published within a year.
• The Bank of England could be given control of macro prudential regulation and oversight of micro prudential regulation under proposals to be put forward.
12.13am: The Lib Dems have just come out of their meeting. The coalition agreement has been approved overwhelmingly by Lib Dem MPs and by the federal executive.
Asked for a comment, Lord Ashdown said: "Hooray."
David Cameron (PM)
Nick Clegg (deputy PM)
George Osborne (Chancellor)
Vince Cable (chief secretary to the Treasury)
Andrew Lansley (health)
Liam Fox (defence)
David Laws (education)
Danny Alexander (Scotland)
Philip Hammond (work and pensions)
Announced today (May 12):
Dominic Grieve (attorney general)
Ken Clarke (justice secretary)
Theresa May (home secretary)
Mods: Don't think we've had a post clarifying the Cabinet members as well as a full rundown of the policies that both parties have agreed on. Probably worth a read. But now I'm going to go cry myself to sleep.
UPDATE: Updated list of Cabinet posts.