The three independent MPs who are likely to hold the balance of power after Australia's inconclusive general election met on Tuesday to discuss strategy.
According to the latest figures, Labor has 72 seats, the Coalition 70, the Green Party one and three have gone to sitting independents. Four more seats are as yet undecided.
The ABC reports Labor is still hopeful it can take the Tasmanian seat of Denison, which would bring the likely outcome to 73 seats to each of the two major parties.
Caretaker Prime Minister Julia Gillard and Opposition leader Tony Abbott are in Canberra to start talks to form a government.
One of the three independents, Rob Oakeshott, told Morning Report that he, Bob Katter and Tony Windsor were having formal discussions in Canberra on Tuesday about what they want from the big parties.
"It's a pretty simple challenge that we've got to address, and that is, how do we get a majority on the floor of the Parliament that can be stable over three years and that can deliver outcomes for the coming three years.
"If we can't achieve that, I think Australia's back to the ballot box, but I'm hopeful that we can."
Mr Rob Oakeshott says the uncertain outcome is not ideal but may result in better policy.
Mr Oakeshott said later he hoped the hung parliament could result in adversies working together.
"A Malcolm Turnbull in a Julia Gillard government or a Kevin Rudd as a foreign minister in a Tony Abbott government - y'know I do think here is a moment where we can explore the edges and explore outside the box," he was quoted on the ABC as saying.
