Oil-rich Norway swung to the left Tuesday after the opposition won an absolute parliamentary majority by vowing to spend more on education, health and welfare.
Labour party leader and former prime minister Jens Stoltenberg seemed certain to head the next government. His coalition with the Socialist Left and the agrarian Centre Party won, with more than 99 percent of the vote counted, a combined 87 of the 169 seats in parliament.
Stoltenberg's coalition will enjoy Norway's first absolute parliamentary majority in 20 years.
Prime Minister Kjell Magne Bondevik and his center-right allies won just 82 seats, after a close race that swung dramatically back and forth between the right and the left in polls during the final days of the campaign.
Bondevik told King Harald V on Tuesday that he plans to resign next month after presenting the budget proposal for 2006, according to his personal advisor, Oestein Mjaerum.
The left, which presented a united front in the election campaign for the first time, promised voters that it would focus on the country's welfare state, which by international standards is very generous but which Norwegians perceive as being in decline.
Bondevik's coalition had touted Norway's robust economic health during its four years in power, and argued that Stoltenberg's promises of more spending would destroy jobs and drive interest rates higher in the Scandinavian country, which is the world's third largest oil exporter.
Minority governments have been the rule in Norway, and prime ministers here have enjoyed an outright parliamentary majority only twice in the past 36 years.
"We promised an absolute majority and that's what we're going to give the country," Stoltenberg told reporters after claiming victory.
This will be Stoltenberg's second go at the helm.
In 2000, he organised a parliamentary revolt which caused then-PM Bondevik to fall and gave him a one-and-a-half-year stint as premier. But in 2001 he lead Labour to its worst election defeat in a hundred years after presenting himself as a party modernizer.
Since then, Stoltenberg, 46, has sought to build bridges to the traditional party base, and this time positioned himself more clearly to the left, notably by denouncing tax cuts for the wealthy.
Now, his three-party coalition faces towering challenges as it attempts to trace out policies that all the parties can sign onto.
While the trio agree on many domestic policy goals, such as a more equal division of Norway's wealth, they hardly see eye-to-eye when it comes to foreign policy.
The parties adamantly disagree on Norway's current participation in Nato and a possible future application to join the European Union, as well as its relationship to the United States.
They were expected to clash in particular over energy and environmental policies.
The Socialist Left Party, which appeared to have won 15 seats in parliament, has come out against building gas power plants and allowing oil freighters to traffic the Barents Sea in the north because of pollution risks. This could jeopardise Labour-supported economic policies.
The makeup of the next government will not be announced until after parliament re-assembles on October 10. The exiting government's far-right parliamentary ally, the Progress Party, was one of the biggest winners in Monday's election, landing a total of 37 seats, up from 26 four years ago.
"The Progress Party will be the ... leading non-socialist party, which will sweep the leftist coalition out in four years, if they hang on that long," said party chief Carl Ivar Hagen amidst thundering applause from his constituents ahead of the final tally. Bondevik said he planned to take a step back from politics.
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