Deal keeps PM Gillard in power

The decision ended two weeks of uncertainty left by national elections which finished on a knife-edge.

Australia’s first woman prime minister promised her government would be stable over the next three years, although the defection of a single politician would bring down the Labour administration.

“Labour is prepared to deliver stable, effective and secure government for the next three years,” she told reporters.

The independents’ support means Ms Gillard can continue with her plans to introduce a 30 per cent tax on iron ore and coal miners’ burgeoning profits and make Australia’s biggest polluters pay for carbon gas emissions.

Labour gained the ability to form a government for a second term after two independent politicians, Tony Windsor and Rob Oakeshott, joined her coalition more than two weeks after elections failed to deliver a clear winner for the first time since 1940.