Gillard and Abbott making their big pitches

JULIA GILLARD and Tony Abbott are personally leading negotiations with the independents and Greens to win their support to form Australia's first minority government in 70 years.

As the early momentum leant towards Labor yesterday, the independents said they would opt for the side that gave the best promise of stable government for three years.

If this could not be negotiated, Australia should go back to the polls, to Rob Oakeshott and Tony Windsor say.

Ms Gillard said Labor's policy platform, including broadband, rural health and climate change, best matched the policy demands of the independents and stood the best chance of passing a Greens-controlled Senate.

Decision time ... Bob Katter, Rob Oakeshott, Andrew Wilkie, Tony Windsor and Adam Bandt.

''I think it's a question of who can build the government that can work,'' she said. In an interview with the Herald, Ms Gillard asked Australians not to look at Labor's recent history but to her personality as the basis for a stable government.

She said she was better placed to form the government because Labor had won a bigger share of the two-party-preferred vote, offered integrated policies, and Ms Gillard was higher in the opinion polls as preferred prime minister.

Mr Abbott said it was he who best offered stability and the independents should note that the Coalition received 500,000 more primary votes than Labor.

''It's almost inconceivable that any Labor government emerging from this election could deliver competent and stable government,'' he said.

Gillard Abbott

''Any government emerging from yesterday will be chronically divided and dysfunctional.''

There was deep disappointment in Labor ranks with anger being directed at the party headquarters for the campaign it had run and the leaks that derailed Ms Gillard's campaign.

Prediction by Antony Green, election analyst.

Labor was split yesterday over whether it would have done better had Kevin Rudd still been leader. Those who ousted him said the result would have been worse, a view backed by senior Liberals. ''You are going to see a lot of rewriting of history,'' one MP said.

There was a strong sense of feelings being suppressed to avoid damaging Labor's claim to form a stable government.

Ms Gillard will go to Canberra today to continue negotiations as it was confirmed yesterday that neither Labor nor the Coalition would achieve the minimum 76 seats required to govern in its right. The one Green and four independents would be critical.

Late yesterday the Coalition had 70 seats, and was leading in three others, including the line-ball West Australian seat of Hasluck.

Labor had 72 but if it wins Hasluck the Coalition would then have 72 seats and scant chance of finding the four extra MPs.

The Green, Adam Bandt, who won the Labor seat of Melbourne, said he would sit only with a Labor government.

The three incumbent rural independents - Bob Katter from Queensland and Mr Oakeshott and Mr Windsor from NSW - will negotiate as a bloc.

In Tasmania, the former intelligence officer and former Greens candidate, Andrew Wilkie, was ahead in the Labor seat of Denison. In WA, Wilson Tuckey lost his seat to the Nationals' Tony Crook, who is not bound by a Coalition agreement but is unlikely to sit with a Labor government.

A non-Labor source associated with negotiations said incumbency would advantage Ms Gillard. ''She's still the Prime Minister. All the independents will have to choose to throw her out of office and that's a big step,'' he said.

The Coalition's efforts were damaged when the Nationals senator Barnaby Joyce and leader Warren Truss insulted the rural independents on election night. Yesterday, Mr Windsor called Senator Joyce a fool and Mr Katter called him ''a piece of incredible unfortunateness''. Senator Joyce said: ''They have a licence to say what they like. They are in a very powerful position.

''My concern is when the markets open. We need to get this resolved, it's not just about us.''

Ms Gillard spoke with the four independents yesterday and met the Greens leader, Bob Brown, and Mr Bandt in Melbourne. Mr Abbott contacted the three rural independents, spoke to Senator Brown briefly and left messages for the others.

The rural independents held a phone hook-up at 8.30pm and Mr Oakeshott is keen for them all to go to Canberra as early as today for talks with the main party leaders.

They all cited broadband as a policy concern, leading Mr Abbott to promise to have another look at his much-derided policy.