By Rob Taylor
CANBERRA (Reuters) - Australian Prime Minister Julia Gillard's hopes of forming a minority government received a boost on Thursday with "kingmaker" independents criticising her conservative rival for refusing to meet a key demand.
Gillard's Labour party seems to be ahead in early negotiations to form government, having agreed to all seven of the initial requests by the crossbench MPs, and with three of them backing Labor's plans for a new resource tax.
Labour also firmed as favourite overnight with bookmakers after conservative leader Tony Abbott refused an independent request to have his election policies costed by treasury.
Independent Tony Windsor said Abbott's refusal to cooperate was like "a bucket of concrete around one foot" in the race to form a minority government.
"It's not a good start at all, because when we go to this issue of stability (of government) ... what we're trying to establish here is a degree of trust," Windsor said.
One of the few positive signs for Abbott on Thursday was a Daily Telegraph newspaper opinion poll showing a majority of voters in the rural electorates of the three independents wanted them to back conservative leader Abbott into power.
Australia's rural folk traditionally belong to the socially conservative end of politics.
Gillard has also offered to surrender her right to decide the next election date, a political ace for a prime minister, and agree with the three independent and Green MPs on the date.
"The PM's ability to decide election timing is an important power. Giving it away is no small thing. This guarantee is vital to the independents for two reasons. It maximises their period of influence," said senior political correspondent Michelle Gratton in The Sydney Morning Herald.
Both Gillard and Abbott have agreed to serve a full three year term and not have an election before August 2013.
VOTE COUNT CONTINUES
Counting was continuing in the inconclusive election, with the latest tally 71 seats each for Labour and the Liberal-National coalition, five independent and Green MPs and three seats still in doubt in the 150-seat lower house of parliament.
To form government a major party needs 76 seats.
Financial markets are hoping for a conservative government which would kill Gillard's plans for a 30 percent mining tax and a price on carbon emissions, as well as her Labour government's planned $38 billion broadband network.
Abbott opposes all three Labour policies.
Global asset management firm Bennelong Security Global Investors on Thursday told The Australian newspaper that telecommunications giant Telstra was "uninvestable," due to the political uncertainty around the broadband project.
The three independents have made seven demands to Gillard and Abbott, including briefings from senior public officials on resources, broadband policy, health, climate change and energy, defence, education, employment laws, infrastructure and transport, and agriculture.
Abbott said he would not agree to have his policies costed by treasury as earlier costings were leaked to the media. "Now if he looks so bad, and he's got something to hide, it makes it much more difficult for us to give him the gong to become prime minister," said stetson-wearing independent Bob Katter.
Talks on forming Australia's minority government could stretch into late next week after the completion of vote counting, including many thousands of votes that were sent in the post and have yet to be delivered.
Online bookmaker Sportsbet is currently paying A$1.85 for a Labour-led government and A$1.90 (1.08 pounds) for a minority conservative administration, a turnaround from Wednesday when Labour paid A$2.45 and the opposition A$1.52.
(Editing by Michael Perry and Mark Bendeich)
