Gillard, Labor to govern Australia with independents

Australian Prime Minister Julia Gillard and Independent MPs Rob Oakeshott (top) and Tony Windsor. Photos / AP, Getty Images

Prime Minister Julia Gillard's center-left Labor Party will form a minority government to rule Australia for a second three-year term, after two independent lawmakers joined her coalition this afternoon, in the interest of stable government.

The decision by Tony Windsor and Rob Oakeshott gives Gillard's party control of 76 seats in the 150-seat House or Representatives and avoids the need for another round of polls, following inconclusive elections late last month.

It also means Gillard can continue with her plans to introduce a 30 per cent tax on iron ore and coal miners' burgeoning profits and make Australia's biggest polluters pay for carbon gas emissions.

Abbott's coalition won 73 seats and another independent, Bob Katter, announced earlier Tuesday that he preferred Abbott as prime minister, partly because he opposed the mining and carbon tax plans.

August 21 elections were the first since 1940 to fail to deliver a clear winner.

Windsor and Oakeshott, who have both championed better communications infrastructure for rural areas, said Labor's plan to introduce an $43 billion high-speed optical fiber national broadband network was a major factor in their decision.

Mr Windsor - who announced his decision first - said broadband and renewable energy policies were deciding factors for him, as well as producing a government most likely to last a full-term, reported The Australian.

"We've also looked at issues of stability - if a government is formed, how long could it last? What sort of relationship would there be with the Senate?" he said.

Mr Oakeshott has said all the Independents had struggled with a "wicked dilemma".

"What this is, is a hard decision," Oakeshott told reporters in announcing his decision. "There's no question about that. And on my end, it has been an absolute line-ball, points decision, judgment call, six of one, half dozen of the other. This could not get any closer," he added.

Windsor said he believed that Gillard was more likely than Abbott to work constructively with the independents and govern for a full three-year term rather than call an early election.

During intense negotiations with the independents, both Gillard and Abbott had promised that, if they could form a minority government, they would not later call an early election in the hope of winning an outright majority.

Labor won only 72 seats but has enlisted the support of a lawmaker from the Greens party plus three independents.

Liberal Party lawmakers argue that the Greens' influence will make the Labor minority government Australia's most left wing government in years.

New Zealand prime minister John Key offered his congratulations to Julia Gillard.

"We've already established a good relationship in the short time she has been prime minister," Mr Key said.

"It was a very hard fight fought campaign in Australia.

"From New Zealand's point of view, we're looking forward to working with the Government.

"I know what it's like to be in a tough fight, this is the tinniest of margins."

-AP, NZ Herald staff