Australia's ruling coalition elected to surprise third term

Australia's conservative Prime Minister Scott Morrison praised "quiet Australians" for delivering his party a "miracle" election victory on Saturday after his Labor challenger conceded defeat.

Morrison had entered the election as an underdog, but after a hard-fought campaign defied the odds to extend the Liberal-National coalition's six-year rule.

"I have always believed in miracles!" he told jubilant supporters in Sydney. "How good is Australia!"?

Shorten accepts defeat, resigns 

Australian election favourite Bill Shorten conceded defeat after his defeat in national polls on Saturday, saying he would resign as party leader. 

"It is obvious that Labor will not be able to form the next government", Shorten told disbelieving supporters in Melbourne. 

"In the national interest, a short while ago I called (Liberal leader, Prime Minister) Scott Morrison to congratulate him," he said.

Earlier, National broadcaster ABC called the election for Prime Minister Scott Morrison’s coalition.

The Liberal Party-led coalition seemed on track to win at least 73 seats and the opposition Labor Party at least 65 seats in the 151-seat House of Representatives, where parties need a majority to form a government. 

The close result from Saturday’s election raises the prospect of the coalition forming a minority government. 

Pre-election opinion polls had suggested that the coalition would lose its bid for a third three-year term, and that Morrison would have had one of the shortest tenures as prime minister in the 118-year history of the Australian federation.

Soraya Lennie has more from Melbourne.

Morrison is the conservatives' third prime minister since they were first elected in 2013. He replaced Malcolm Turnbull in a leadership ballot of government colleagues in August.

Morrison began the day campaigning in the island state of Tasmania in seats he hopes his party will win from the centre-left Labor Party opposition.

He then flew 900 kilometers home to Sydney to vote and to campaign in Sydney seats.

Opposition leader Bill Shorten had said on Saturday morning that he was confident Labor would win, but Morrison would not be drawn on a prediction.

"Tonight the votes will be counted up and we'll see what the outcome is. I make no assumptions about tonight," Morrison said after casting his vote.

Outside the polling booth, Morrison was approached by a demonstrator protesting the proposed Adani coal mine that the government recently approved.

But security intercepted her before she could reach the prime minister.

Shorten contained his campaigning to polling centres in his home town of Melbourne, where he voted on Saturday morning.

Shorten had earlier said he expected that Labor would start governing from Sunday. He said his top priorities would be to increase wages for low-paid workers, hike pay rates for working Sundays and reduce Australia's greenhouse gas emissions.

"The world will know that if Labor gets elected, Australia's back in the fight against climate change," he said.

Shorten has been campaigning hard on more ambitious targets to reduce Australia's greenhouse gas emissions.

Australia is the world's largest exporter of coal and liquefied natural gas. It is also one of the world's worst carbon gas polluters per capita because of a heavy reliance on coal-fired electricity.

As the driest continent after Antarctica, it is also particularly vulnerable to the impacts of climate change, such as wildfires and destructive storms.

The government has committed Australia to reduce its emissions by 26 percent to 28 percent below 2005 levels by 2030.

Labor has promised a 45 percent reduction in the same time frame.

Shorten, a 52-year-old former labour union leader, had also promised a range of reforms, including the government paying all of a patients' costs for cancer treatment and a reduction of tax breaks for landlords.

Morrison, a 51-year-old former tourism marketer, said he had closed Labor's lead in opinion polls during the five-week campaign and predicted a close result.

Morrison promises lower taxes and better economic management than Labor.

An opinion poll published in The Australian newspaper on Saturday had put Labor ahead of the conservatives 51.5 to 48.5 percent. The Newspoll-brand poll was based on a nationwide survey of 3,038 voters from Monday to Friday. It has a 1.8 percentage point margin of error.

Political analyst William Bowe said earlier that it was unclear how the greater support for Labor evident in polls would translate into seats.

He said the conservatives had been "trying to plot a narrow path to victory" by targeting their campaigning on vulnerable Labor seats in Sydney, Tasmania and the Northern Territory.

A factor that was not fully reflected in the latest poll was the death Thursday night of former Labor Prime Minister Bob Hawke.

He is widely praised for the economic reforms that his government achieved from 1983 until 1991, and his support for Shorten was expected to boost Labor's vote.

During Labor's last six years in office, the party replaced Prime Minister Kevi n Rudd with his deputy Julia Gillard, then dumped her for Rudd.