Iain Dale has done a fun (and presumably very time consuming exercise) where he has gone through every individual seat in the country and made a prediction about who he thinks will win based on gut feel in each case. He says that the overall result surprised him:
Plaid Cymru 5
Northern Ireland 18*
Which would give the Conservatives an overall majority of just 12 seats.
Various posters on Political Betting question some of Iain's assumptions, the main one being that they think he has overestimated the number of Lib Dem seats, perhaps due to his own personal experience in North Norfolk against Norman Lamb in 2005.
Anyway, I thought it might be interesting to think through what an election result like this might mean for the parliament that ensued. I think there would be several main effects:
1) I do not think that David Cameron would go to the country again soon afterwards. Although a majority of 12 is very small, it is a majority. Technically he would be able to govern with no assistance needed from any other party (assuming his backbenchers hold the line!). It would be a very brave Prime Minister who gave that up in the hope of something better when it could instead be snatched away from him altogether. However...
2) Because he would have such a small majority he would have to listen to the views of his backbenchers much more keenly than the Labour government has needed to. It would be the sort of situation that I remember from the dying years of the Major government. Because there is quite a sharp divergence between some of the Conservative leadership's policies and its MPs (e.g. on climate change and Europe for example) this could start causing problems very quickly. I can imagine that Mr Cameron might even need the support of the Lib Dems and even Labour in order to get some of his measures through.
3) Related to point number 2, although the Lib Dems would only have increased slightly in number of seats, they would have greatly increased influence because of the arithmetic of the parliament. Cameron, knowing that he may need support from outside his own parliamentary ranks would likely take account of the views of the Lib Dems when drafting legislation.
4) Because some of the decisions that Cameron would have to take would be pretty unpopular (on the economy etc.) it is likely that any by-elections triggered in existing Conservative seats could easily be lost. It would only take 6 or 7 of these before his administration would become a minority one. That is perfectly possible - indeed it happened to John Major (although some of his loss of majority was due to defections which are much less likely).
5) This would make the subsequent general election in 2014 or 2015 all to play for. Because of this, I would expect that the Labour Party would not tear itself apart in opposition as the possibility of a return to power in 4 or 5 years time would be very real and this would focus their minds. One of the reasons that the Conservative Party was such a basket case from 1997 onwards is because they were so far from a return to power and they knew it.
6) Finally, I would suggest that whilst the Labour leader would not be Gordon Brown within a few months of the election, the Lib Dem leader would remain Nick Clegg right through the parliament. Having increased his party's share of seats, this would cement his (already pretty secure) position.
As it happens, I also think Iain is overstating the Lib Dem total (I think our vote share will remain about the same as 2005 but our seat number will slip slightly) but I actually think Labour will hold up better than he thinks too and as I stated in my 2010 predictions, Cameron will form a minority government.
This is all good speculative fun of which I expect much more as we move ever closer to the election.