Australian election: Turnbull and Shorten face hung parliament

Malcolm Turnbull and Bill Shorten have begun courting the five lower house independents who look set to be kingmakers if the 2016 Australian election delivers another hung parliament.

Despite this outgoing prime minister Mr Turnbull insists he is “quietly confident” of a narrow majority after postal votes are counted.

After suffering an unexpected nationwide 3.4 per cent swing and losing 11 seats to Labour, with at least six more in doubt, Mr Turnbull has begun contingency planning for the minority government he has long argued would be chaotic and disastrous for the nation.

ExpandAutoplay

Image 1 of 4

Australia’s prime minister Malcolm Turnbull (centre) and his wife Lucy (second left) leave the polling station after casting their vote in Sydney. Photograph: Getty

While he insisted he was “quietly confident” of a majority Coalition government, the prime minister – in a sharp contrast to his election campaign warnings about the dangers of a vote for minor parties – emerged on Sunday afternoon to promise to “work constructively” with the crossbench to deliver a stable government “without division or rancour”.

“It is very important to recognise that this is the people’s house, the people have chosen the members of the parliament, and we will work with all of them to deliver the stability and the leadership that Australians expect,” the Liberal leader said.

“We will work effectively, constructively, to ensure that we have a strong majority government, and we will work across the crossbenchers as well, if we need to do so.”

Liberal strategists agreed it was possible Turnbull would fall short of a majority for the Coalition but said postal and absentee votes were favouring the Coalition. Labour sources said they believed a hung parliament was now the most likely outcome.

Ms Shorten, who polled better than expected especially in “battler” seats with lower average wages and higher unemployment, said he was ready to work with “people of goodwill in the parliament” and had also begun talking to the crossbench.

“I’ve spoken to some of the crossbenchers, not all, but I get the sense they want to be constructive.”

But neither leader can do anything definitive until clearer results are known after official counting resumes on Tuesday.

"I'm not sure who has finally won, we should now allow our professional Australian Electoral Commission to do their job and count the votes. What I'm very sure of is that while we don't know who the winner was, there is clearly one loser, Malcolm Turnbull's agenda for Australia and his efforts to cut Medicare," Mr Shorten said.

Surprise Outcome

The surprise outcome has widespread ramifications for Australian politics.

Even a slim lower house majority is a disastrous outcome for Turnbull's authority. In the upper house it appears that for any legislation opposed by Labour and the Greens, the coalition will need the votes of three Nick Xenophon Team senators, two or three senators from Pauline Hanson's One Nation including Hanson herself who returned to parliament, Jacqui Lambie and broadcaster Derryn Hinch.

That result makes it highly unlikely the Coalition will be able to legislate the full program of company tax cuts that were its central promise in the campaign, nor the industrial relations laws that were the reason for calling the double dissolution election.

Recriminations are already starting from Coalition conservatives, who are demanding Turnbull reconsider his superannuation policy and restore his predecessor Tony Abbott to the frontbench, something Turnbull continues to insist he won’t do.

Under Labour rules Shorten could also face a post-election leadership ballot, with frontbencher Anthony Albanese the most likely challenger. Shorten said on Sunday he had “never been more certain of my leadership position than I am this morning.”

A challenge would be almost impossible in a hung parliament outcome as it would leave the party leaderless for a month and after Labour’s unexpectedly strong result is considered unlikely.

Business groups and economists expressed concern about the impact the political uncertainty would have on the economy, urging politicians to work together to deliver a clear outcome.

A hung parliament would leave each leader seeking to form a government with some degree of backing from the five lower house independents – Victorian independent Cathy McGowan, Andrew Wilkie, Bob Katter and the new Nick Xenophon Team MP, Rebekha Sharkie.

Greens MP Adam Bandt has said he could not support the Coalition. It opens the prospect of a repeat of 2010 when Australia waited 17 days while Julia Gillard and Tony Abbott sought to form a government.

But this time neither leader would be able to allay concerns of instability by securing formal agreements from many on the crossbench, as Gillard did.

Mr Wilkie and Ms McGowan have said they will do no formal deal with either party, but have left open the prospect of agreeing to pass supply and allowing a government to function, unless the parliament saw reason to pass a vote of no confidence.

Agencies /Guardian