Norway poll sparks power struggle

Exit stage left? Jens Stoltenberg contemplates defeat

Norway's Labour Party has suffered its worst election result since 1924, after an election campaign dominated by anger at high taxes.

With 98% of the votes counted by early Tuesday, Labour had taken only around 24% - down from 35% at the last general election four years ago.

What is clear is that this was a very bad election

Outgoing Prime Minister Jens Stoltenberg

Weeks of horse-trading are now thought likely to lie ahead, as three parties try to form a government - and three men attempt to become prime minister.

Voters were thought to be protesting at tax rates of up to 50% and inadequate public services, in a country made wealthy by oil.

Election officials said Labour was likely to take around 43 seats in the 165-member parliament - down dramatically from its previous level of 65.

The Conservatives came second with about 21% - giving them a likely 38 seats.

Projected seats

Labour - 43

Conservatives 38

Christian Democrat-led coalition - 34

Far-right Party of Progress - 26

Socialist Left - 23

The parties will need to build a coalition bloc adding up to 83 seats to secure a majority in the parliament, the Storting.

Among the smaller parties, the far-right Party of Progress has made gains. It won an estimated 26 seats, up from 20.

The three-party centrist Christian Democratic-led coalition won a projected 34 seats, down from 42.

Former Prime Minister Kjell Magne Bondevik, of the Christian People's Party, said he would also try to form a government.

Jagland: A big setback

The outgoing Prime Minister, Jens Stoltenberg, who ran the old minority Labour administration, admitted it had been a "bad election" but said he would stay in office if he could muster enough parliamentary support.

"We won't cling to power at all costs, but it would nevertheless be a mistake to relinquish the responsibility of government," he said.

The party's leader, Thorbjoern Jagland, said the vote had been a "serious warning shot".

The historically bad result for the Labour Party is a message that there must be a change of government

Conservative leader Jan Petersen

"We will have to make a decision about whether to continue in government after we know the full results," he said.

The Conservatives hailed the result, and said they should now lead a coalition to power.

"The historically bad result for the Labour Party is a message that there must be a change of government," Conservative leader Jan Petersen said. The campaign in one of the world's richest nations had focused on taxation and the state of public services.

Many voters don't understand how it is possible that we have so much money and yet pay high taxes and live with so many problems that don't seem to get fixed

Think-tank researcher Jo Saglie

Opposition parties argued the government should use Norway's vast oil wealth to cut taxes and improve health and education.

Their claims appear to have struck a chord with voters, fed up with paying high tax and seeing vital services decline - while watching the government apparently hoarding oil revenue.

"Many voters don't understand how it is possible that we have so much money and yet pay high taxes and live with so many problems that don't seem to get fixed," said Jo Saglie, a senior fellow at the Institute for Social Research, an Oslo-based think tank.

"The arguments against spending more of the oil money are very complex and people just don't understand them."

Final official results will not be declared until Wednesday. Around three-quarters of Norway's 3.3m voters took part in the poll.