Australia plunged into uncertainty

Coalition, Labor both fall short of majority.

UPDATE 11am NZT: The House of Representatives tally is now: Coalition: 70, Labour 67, independents and minor parties: 7 (4 right-leaning, 3 left-leaning), too-close-to-call: 6. That's as projected by media. The Australian Electorial Commission has yet to declare a single seat. 78.8% of the vote has been counted. The final count, including special and postal votes, won't happen until Tuesday.

The Australian election has ended in near-deadlock.

A minimum of 76 seats is needed for a majority in Australia's 150-seat lower house.

The Malcolm Turnbull-led Liberal-National Coalition held 90 seats going into Saturday's ballot.

The official election night tally had it tied with Bill Shorten-led Labor Party on 67 seats.

The most optimistic projections for the Coalition have it winning 74, with Labor estimated to win 70; the most pessimistic (for Mr Turnbull) has Labor on 73 and the Coalition 72.

Results from 11 seats – most of which probably won't be known until postal votes are counted on Tuesday – will play a part in determining the outcome. So will half a dozen independent and minor party MPs (between five and seven are expected to make it to Canberra, depending on final results).

The Coalition is the incumbent in 10 of the 11 too-close-to-call seats. Labour holds a thin election night lead in six of the 11.

Mr Turnbull, who rolled Tony Abbott in September last year, was described by the Sydney Morning Herald as "looking disorientated and stressed" as he left his Sydney mansion for a post-midnight press conference at the Sofitel Hotel.

The Coalition leader told supporters, "I’m sure that as the results are refined and come in over the next few days with all of the counting, we will be able to form that majority government."

However, most pundits are picking Mr Turnbull will have to settle for leading a minority government.

If he is able to form a government at all, It's likely the Coalition leader will have to rely on horse-trading with a handful of conservative-leaning independent MPs to get legislation through on a bill-by-bill basis. One will be Bob Katter, ex-National and a probable one or two new MPs from Team Nick Xenophon, the party named after its leader, Senator Nick Xenophon, who has a seat in the upper house. 

Nick Xenophon

The probable line-up of crossbench  MPs is:

  • Adam Bandt, (Green Party; left)
  • Alex Bhathal (Green Party; left)
  • Andrea Broadfoot (Team Nick Xenophon, right-leaning)
  • Bob Katter (Katter's Australia Party leader; right-leaning)
  • Cathy McGowan (independent for a rural seat; right-leaning )
  • Rebekha Sharkie (Team Nick Xenophon; right-leaning)
  • Andrew Wilkie (Green Party turned independent; left-leaning)

Among other issues, Mr Xenophon has campaigned strongly for an investigation and reform following the Dick Smith collapse; Anchorage Capital will be rightly nervous that his party is likely to hold the balance of power.

Mr Katter and Mr Xenophon are both regarded as right-of-centre, but also maverick and unpredictable. Constant negotiations with the pair will likely see Mr Turnbull maintain that stressed look.

Pauline Hanson

Coalition minority in the senate
Mr Turnbull called a "double dissolution" election, meaning all senate seats were up for grabs rather than the usual half.

The Coalition went into the election with a minority 33 of the 76 senate seats; Labor had 25, while a patchwork of independents and minor parties held the remaining 18.

While results are still being finalised, it is clear the Coalition will fall short of the 38 needed for a majority.

In fact, on election night results, it's likely to go backward to 29. It's projected that One Nation leader Pauline Hanson (formerly an MP in the lower house) will return to politics by taking a senate seat in Queensland; it's possible one colleague will join her in what could be called a post-Brexit populist bounce. And the South Australia-centred Team Nick Xenophon could advance from one to three seats.

The Senate has the power to reject or amend most legislation passed by the lower house. Again – if he can form one – Mr Turnbull's government will face bill-by-bill trench warfare to get any legislation through.

It was the Coalition's inability to get legislation through the Senate that triggered Saturday's election.

However results are finalised next Tuesday, it seems likely the new government won't be able to wobble along for long without calling a fresh ballot.

Mr Turnbull – or whoever is in control after Tuesday – will have the option to call another double dissolution or to call a new election for just the House or just the Senate. The only option off the table is a half-term Senate election (involving half the Senate). Under Australia's parliamentary rules, that option is off the table for another two years.


POSTSCRIPT

The Coalition campaigned on its 2016 Budget, passed shortly before the campaign kicked off. The Budget included tax cuts for small business and corporations, but also confirmed the so-called "Google tax" crack down and penalties for profit-shifting multinationals.

Labour made the possible privatisation of parts of the healthcare system a central theme of its campaign. Conservative media dubbed it "the great Medicare scare," but the consensus seems to be that Mr Shorten has done well enough to keep the party's leadership.

Australia has no MMP-style nationwide list vote, and at the electorate level, a preferential voting system means results can hang on how voters' second-choice is allocated where there is no majority winner. That means, as in pre-MMP New Zealand, winning the most votes overall is of academic interest only. But for the record, Labour had 50.06% of the two-party preferred vote on last night's count to 49.94% for the Coalition.

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