Election 2015: it’s what the bookies say that really matters

As 7 May draws ever nearer, the political polls remain indecipherable at best and may be misleading where they pretend otherwise. The odds and spreads however, have started to tell an interestingly different and important development. I will try to translate.

To start with the odds:

Tory minority: 14/5Labour minority: 6/4

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This indicates a 'preference' for a Labour coalition but Miliband has ruled one out with the SNP.

Tory majority: 7/4Labour majority 40/1

This highlights the inevitability that Labour will win fewer seats than the Tories and will need the SNP.

Cameron to be the next PM: 8/11Miliband to be next PM: 8/11

ie one or other is sure to be PM. What a surprise.

These odds are uninvestable, and tell us nothing, except that Miliband is considered 'most likely' to be able to form the next government: but how, other than with the SNP, with whom he has ruled out coalition?

For Miliband to reach a confidence and supply' deal with the SNP will not overcome Cameron's incumbent advantage. And to try to cobble together a deal including Plaid Cymru (4), the Greens (maximum 1) and other left-wing fringe parties (4) while it would get him over the 323 threshold could notbe a coalition of any sort.

Now look at this morning's spreads IG Index tells me that it has seen good business this morning, with the Tories sharply better:

Tory 285.5 289.5 (up)Labour 266.5 270.5 (down a big move to the SNP)LibDem 22 24 (down slightly)SNP 46.5 48.5 (up swing from Labour)Ukip 3.2 5.2 (no change)

Jim Murphy and Douglas Alexander both look set to lose their seats, decapitating Labour in Scotland.

Now the maths from the spreads (using the offer prices):

Tory (289) + LibDem (24) = 313 + DUP (9) + Ukip (5) = 327.

Cameron has every right to try his luck. The rise in Tory seats could be the start of a 'surge' to the Tories. It is the first move In the Tory spread for over a month.

Labour (270) + SNP (48) = 318 + 9 (fringe left parties) = 327.

However, Miliband will have to try negotiating with that lot while Cameron is driving to the Palace. Cameron could justify his right to inform the Queen's Speech, cobble together a Budget and not be voted out of office because of the five-year Parliament Act.

Then the fun starts: Boris might supplant Cameron before that speech, as the price of Ukip support - and that of Clegg's successor (Cable?). The first bill for the Tory leader to introduce would likely be the boundary changes: so obviously fair that no one would dare gerrymander. That would be worth 20 or more extra Tory seats = game over.

So on present showing, it will be very close. But things that could help Cameron to win are 'incumbent party advantage' (1-2%), Ukip eating into the Labour vote in northern England, and Labour votes there reacting to SNP blackmail. And Clegg, if re-elected, will choose the largest party.

With less than three weeks to go, it is the next move in the spreads that will matter. They could easily reverse themselves, but I will tell you.