John Armstrong: Helen Clark's coalition nightmare?

"Hello Tariana, Helen here ... G'day Winston, Helen on the line ... Hello Peter. Can we talk?"

Is this Helen Clark's worst nightmare?

The voters have served up a recipe for paralysis - whichever party manages to scrape together the numbers to form the next Government.

Right now, the (caretaker) Prime Minister will be grateful she is best placed and gets first opportunity by virtue of heading Don Brash off by a mere 20,000 votes.

But it is going to be a heck of a task.

Her best option is a Labour-Jim Anderton's Progressives minority coalition which has the support of the Greens and United Future on confidence motions, while NZ First abstains.

Complicated - to say the least.

Alternatively, she will have to court some combination of United Future, NZ First and the Maori Party if she is to cling to power.

As one senior Labour staffer predicted a week ago, the Prime Minister was swallowing hard last night and ringing Tariana Turia.

The Maori Party leader responded with three demands she expected Labour to accept - entrenching the Maori seats, revisiting the foreshore and seabed law, and rethinking Labour's review of race-based funding.

However, with four seats, the Maori Party may yet be crucial to Clark becoming the first Labour leader to win three elections if she cannot get Winston Peters on board.

If she cannot strike a deal with both Peters and Dunne, then Parliament will be split evenly between the centre-left and centre-right blocs, each having 61 seats.

So what now?

Saturday night's overhang - the new Parliament has two additional seats - is Sunday morning's hangover. And without anyone cracking open the champagne.

That is best kept on ice.

Labour is technically the winner. It is not yet the victor.

Both Peters and Dunne have declared they will talk first to the party that wins the largest shared of the vote.

But that does not necessarily mean Labour will secure an agreement with either.

As befits the script of this election, Peters has lost in Tauranga but survives as an MP to be kingmaker, sort of.

As a minimum, he will require Labour not take the Greens as a coalition partner as the price for his MPs abstaining on confidence motions.

However, he does not have Labour completely by the short and curlies. If Mrs Turia obliges and United Future comes on board, Labour will not need him.

Not surprisingly, Don Brash was refusing to concede defeat last night.

If Labour cannot form a Government, at least he can have a shot at it. But he would need NZ First to vote with him on confidence motions - not abstain - and he would need the Maori Party to abstain.

For National's leader, there must be intense disappointment, despite National's moral victory on the night in falling just short of Labour.

Brash turns 65 next weekend. He is a leader in a hurry.

He needed a strong mandate to implement his policy agenda - particularly on Maori matters. If he does become Prime Minister, he will be shackled by minor party partners.

He looked like he was going to get that mandate early on last night, only to watch Labour claw back National's lead millimetre by millimetre.

On the bright side for National, Act survives. But with only two seats.

Still, victory in Epsom is a personal triumph for Rodney Hide.

It takes MMP to a new level. Voters got the message in that electorate without National having to say anything.

However, Hide's victory takes another wealthy urban seat out of National's hands.

It somehow summed up Brash's bitter-sweet night.

So close - but yet so far.