But Canberra Liberals leader Zed Seselja believes that new ''rainbow coalition'' formed by Ms Gillard will be Australia's least legitimate administration in generations.

The Chief Minister said Mr Abbott's pledges to slash Commonwealth public service jobs would have been disastrous for the territory's economy and Australia had nothing to fear from minority government. Mr Stanhope said his Government's parliamentary agreement with the ACT Greens had delivered stable government to the territory and that he was confident Ms Gillard would be able to govern confidently with the support of two country Independents and one Green.

''It's fantastic result for Australia and for Canberra and we haven't forgotten and we shouldn't forget the promises that Tony Abbott made during the election campaign that would have hade a massive impact on Canberra, that would have sent us into recession,'' he said.

''There's no doubt that we've dodged a great big bullet that was heading fair and square for our forehead.''

Mr Stanhope predicted success for Ms Gillard as a prime minister elected in her own right.