He thanked his "darling angel" wife Margie, and kissed his three daughters, who joined him on stage at the Four Seasons hotel in Sydney for the party's celebrations. Abbott claimed the Labor government "had lost its legitimacy" and as it had been unable to govern effectively with a 17-seat majority, it would not be able to lead the nation as a minority government. He pointed out 400,000 more people had voted for the Coalition than for Labor, who he claimed had fallen to its lowest primary vote since the Second World War. Australia is looking at the prospect of a hung Parliament after damaging swings in NSW and Queensland. There has been a uniform national swing of 2.5 per cent against the incumbent Labor government, and electoral pundits are suggesting it could take a week for the result to be declared.

The ABC's respected election analyst, Antony Green, said he believed the Coalition would get 73 seats, three short of an outright majority. He said Labor would pick up 72 seats, with an historic Greens win in Melbourne, and a possible four independents, which would include an astonishing victory for former spy Andrew Wilkie in the Tasmanian seat of Denison. The Liberal party powerbroker, Nick Minchin, said on the ABC at 9.30pm, he was "reasonably confident" the Coalition would win more seats than Labor, and secure more of the two-party preferred vote; crucial ingredients in forming a minority government. Liberal senator George Brandis told ABC that Labor had "lost the moral authority to govern". At 10.45pm, with 72 per cent of the two-party preferred vote counted, Labor has 50.6 per cent of the vote against the Coalition with 49.4 per cent of the vote - a 2.59 per cent swing against the government. Officially, as at 11pm, the Australian Electoral Commission has called 60 seats for Labor, 58 for the Coalition, three seats for independent candidates with one Greens member. It had 28 still in doubt.

In NSW, there is a swing of 4.9 per cent away from Labor with 73 per cent of the total vote counted. In Queensland, with 73 per cent of the state's two-party preferred vote counted, there’s a 5.6 cent swing against Labor. In the crucial state of Western Australia, after 59 per cent of the count, the Coalition was receiving a swing of 2.53 per cent. In Victoria, with 71 per cent of the two-party preferred vote counted, Labor has experienced a notional swing to it of 0.94 per cent. In South Australia, the Coalition has a slight swing of 0.7 per cent with 75 per cent of the vote counted.

Independents to back 'stable government' The independent MPs who are likely to hold the balance of power in a hung parliament say they’ll side with whichever party can provide the most stable government. One of the independents - NSW’s Rob Oakeshott - says that means they’ll have to take into account the make-up of the Senate, in which the Australian Greens are expected to reign supreme. Mr Oakeshott, who was re-elected to the seat of Lyne with a massive increase in votes, will be joined on the crossbenches by returning New England MP Tony Windsor and Queensland’s Bob Katter. All three were once Nationals. The Greens’ Adam Bandt will join them after winning Melbourne, and there’s a possibility independent Andrew Wilkie will too. The former intelligence officer - who ran on the Greens’ Tasmanian Senate ticket in 2007 - is tipped to take Denison in the Apple Isle.

Mr Oakeshott told AAP on Saturday night he would meet with Mr Windsor and Mr Katter informally as soon as possible. ‘‘More than likely that will be Monday when we know the playing field of exactly what has happened,’’ he said. The three independents won’t necessarily side with the party that has the most seats or votes in the lower house. Rather, they’ll look at who could best deliver stable government ‘‘taking into consideration the make-up of the Senate’’, Mr Oakeshott said. What the exit polls said A Sky News exit poll, conducted by Auspoll in 30 key marginal seats today, showed the two-party preferred vote went 51 per cent to Labor and 49 per cent to the Coalition.

A Nine Network exit poll is also predicting a close win to Prime Minister Julia Gillard, with Labor picking up 52 per cent of the overall vote to 48 per cent for the opposition. But the poll also reported sharp swings against Labor in crucial marginal seats in Queensland and NSW, where both Ms Gillard and Opposition Leader Tony Abbott focused most of their campaigns. The Coalition needs 17 Labor seats to win the election by garnering a uniform swing of 2.3 per cent across the country. But the government can lose its absolute majority if it loses 13 seats. Former Liberal deputy prime minister Peter Costello predicted just after 8pm a hung parliament, while Labor party powerbroker Graham Richardson said he still believed the Coalition could steal a victory. Fourteen million voters are enrolled or eligible to have a final say on who becomes prime minister.

If it comes down to the wire an outcome may be delayed as almost one-fifth of voters cast their ballot early. The Australian Electoral Commission said 2.35 million voters voted early — either by post (950,000 — 140,000 more than in 2007) or at early voting centres. The counting of pre-poll votes cast outside the voter's electorate, and postal votes, will not begin until tomorrow. Legally, the count of postal votes can not be finalised until 13 days after polling day. Leaders cast votes in tight race After spending part of the morning in the crucial western Sydney seat of Lindsay, Ms Gillard returned to her home town of Melbourne, beaming for the cameras and declaring ''there it is'' as she cast her vote for her health minister Nicola Roxon.

Due to a boundary redistribution, Ms Gillard's home suburb of Altona is no longer in her electorate of Lalor. She chatted with voters, some of whom kissed her or presented her with flowers. ''I'm exercising my own vote,'' Ms Gillard told reporters. She said it was a ''tough, tight, close contest'', but she was ''very, very happy to be back in Melbourne''. Mr Abbott voted at a surf club in his Sydney seat of Warringah, queuing up with his wife Margie and their three daughters, Louise, Frances and Bridget. ''This is a big day for our country,'' Mr Abbott said.

''It's a day when we can vote out a bad government.'' Mr Abbott is expected to arrive at the Liberal Party's election function at the Four Seasons hotel in Sydney around 9.30pm (AEST). Ms Gillard will be in Melbourne. Labor remained the bookmakers' favourite to win as counting began. Centrebet took a bet of $60,000 at $1.60 on Ms Gillard's team before shortening Labor's odds to $1.39 this afternoon. Loading

The Coalition meanwhile with Centrebet has drifted out to $2.90, from $2.38, and punters can help themselves to $2.55 for a hung parliament. - AAP with Fairfax reporters

