Australia's Prime Minister Julia Gillard has got the jump on Opposition leader Tony Abbott, making first contact with independent MPs and the Greens about forming a stable minority government.
Despite suffering a massive backlash at the ballot box, Ms Gillard on Sunday claimed a mandate to govern because Labor had won the popular vote, even though it doesn't have the numbers to deliver government.
Australia remained in political limbo on Saturday after both Labor and the Coalition failed to gain the 76 seats needed to form government in their own right.
Political observers are tipping it could take a week or more for the result to crystalise, with thousands of crucial postal votes yet to be counted.
Late Sunday, the Australian Electoral Commission was calling 70 seats for Labor, the same for the Coalition, three to independents and one to the Greens.
Six seats - Boothby, Brisbane, Corangamite, Denison, Hasluck and Lindsay - remain in doubt.
Early signs are that a handful of independents who will determine who governs are more likely to support Labor, primarily because it is expected to be better able to work with the Australian Greens, who are tipped to hold the balance of power in the Senate.
But Mr Abbott maintained a "chronically divided and dysfunctional" Labor had lost its authority after taking a savage hammering from the electorate.
"It is historically unprecedented for a first-term government to receive the kind of rebuff that the Rudd-Gillard government received yesterday," he told reporters in Sydney.
As Australia faces its first hung parliament since 1940, a decision on the make-up of the next government rests in the hands of up to six individuals not aligned with either Labor or the coalition.
Greens MP Adam Bandt is set to join re-elected independents Rob Oakeshott, Tony Windsor and Bob Katter in the House of Representatives.
Independent Andrew Wilkie in Tasmania is also in the race to snatch the seat of Denison from Labor.
Their ranks may be further boosted by WA Nationals MP Tony Crook, who has signalled he will act independently of the coalition.
Negotiations begin
Ms Gillard was first out of the starting blocks on Sunday to begin what are likely to be long and complex negotiations to form a workable government.
"It's my intention to negotiate in good faith an effective agreement to form government," she told reporters in Melbourne.
She held talks either in person or by telephone with the Independent and Green MPs.
Despite the political uncertainty, Ms Gillard assured financial markets that government stability continued.
Independents to meet
Mr Oakeshott, Mr Windsor and Mr Katter are planning to travel to Canberra to meet on Monday to discuss the possible permutations of the election, as well as any role they may play.
The independents have stressed a priority will be stable government.
The independents have signalled some of the key policies where they would like to see change include broadband and climate change.
Mr Bandt, whose victory in Melbourne makes him the Greens first lower house MP elected at a general election, reiterated his position that his strong preference was to work with a Labor government.
