By Reed Stevenson and Harro ten Wolde
AMSTERDAM (Reuters) - The Dutch were voting in a parliamentary election on Wednesday which looks set to award the austerity-minded Liberal Party the most seats but force it into coalition talks that will delay steps to tackle the deficit.
In a departure from recent elections in the Netherlands that were dominated by immigration and foreign policy issues, fiscal austerity has become the central campaign theme as sovereign debt woes plaguing Greece and other euro zone countries threaten the stability of the currency bloc.
The Liberals, run by a 43-year-old former human resources manager at consumer goods giant Unilever, have advocated steep budget cuts, a pared down government and a reduction in benefits for immigrants. Their calls to keep in place tax deductions on mortgages has also resonated with voters.
Polls project a neck-and-neck race between Mark Rutte's Liberals, seen winning 34 seats in the 150-seat parliament, and Job Cohen's Labour party.
"It will be a choice between tackling problems now or postponing measures," Rutte said on Wednesday on television. Cohen responded by saying the economy would be in good hands with Labour.
In order to attain a governing majority of 76, the winner will have to forge a coalition with at least two other parties. Negotiations could drag on, pushing back the implementation of policies aimed at slashing a deficit expected to reach 6.6 percent of GDP this year.
"It is important to quickly have a cabinet with decisiveness and public support to start the reforms," said Wouter Koolmees, an economic expert in the centrist D66 party, which may be part of the next ruling coalition.
"People realise you have to address public finances otherwise you will end up like Greece," he said.
Rutte said he would like to see a government by July 1.
Polls opened at 7:30 a.m. (6:30 a.m. British time) and close at 9 p.m.
Although the Netherlands, the euro zone's fifth largest economy, enjoys one of the highest debt ratings in the currency bloc, its borrowing costs have edged higher amid concerns over its ability to pay back loans.
An auction of three-year bonds on Tuesday showed a spread of 40 basis points over comparable German benchmarks, up from 15 to 20 basis points a week ago and just 7 points in March.
The vote seems sure to end the eight-year tenure of Prime Minister Jan Peter Balkenende, whose Christian Democrats had ruled with the Labour Party until February, when the government collapsed over a disagreement on extending the deployment of Dutch troops in Afghanistan.
The Labour Party is projected to come second to the Liberals after losing some early momentum when Amsterdam mayor Job Cohen replaced the previous leader Wouter Bos.
The party of anti-immigration populist Geert Wilders is set to double its seats, while D66 is expected to pick up 11 seats. (Additional reporting by Gilbert Kreijger, editing by Janet Lawrence)
