Prime Minister Malcolm Turnbull says he will work openly with the large crossbench in the 45th parliament because it was 'vital' for the government to meet the "great challenges Australia faces".
His comments came after Opposition Leader Bill Shorten finally admitted defeat this afternoon.
Mr Shorten conceded defeat in the federal election, while coalition frontbenchers clamoured to declare victory as their party crawls towards the finish line with a marginal majority.
"It is clear that Mr Turnbull and his Coalition will form a Government," Mr Shorten said in a brief press conference. "I've rung him up and conveyed my congratulations."
Mr Shorten took the opportunity to pay tribute to Labor voters, both old and new.
"Many of you voted Labor for the first time," he said. "The Labor party will stick true to its core values and beliefs, and we will always stand for Labor values."
Mr Shorten said Labor was willing to work to find "common ground" with the Government, saying Australians deserve "nothing less".
"I understand we need to make this parliament function and we'll be up for that," he said.
"I hope for the nation's sake that the Coalition does a good job."
Mr Shorten also highlighted some of Labor's key policies and values before making his exit.
"Medicare, better schools, Australian jobs ... Labor will always put people first."
Responding to Mr Shorten's concession, Mr Turnbull moved to calm potential tension with the 45th parliament's large cross bench, saying his government would work openly with all members of parliament.
He said the parliament would work 'unrelentingly' to provide good government and economic management.
Earlier today, the ABC reported that the Coalition was on track to win at least 74 seats, with another five seats still in doubt.
Cabinet Secretary Arthur Sinodinos told the ABC earlier that the coalition was “on track to win” the 76 six seats it needs to govern in its own right.
"We got more primary votes than Labor and we're going to end up ahead of them on the two-party preferred," he said.
"We're the Government, so if anyone has a mandate it's the Government.
Deputy Prime Minister Barnaby Joyce is also certain the coalition has won the election. He has called on Bill Shorten to finally concede.
The coalition is edging ever closer to gaining enough seats to govern in its own right, albeit by the slimmest of margins.
After one week of counting, the Coalition has 74 seats in the 150-seat House of Representatives and Labor 66 seats with five seats still too close to call.
"I'm absolutely certain as part of an effective coalition we have won this election," Mr Joyce told Sky News on Sunday.
He also expects the Nationals will hold the seats of Flynn and Capricornia, which remain too close call.
"Let's have Mr Shorten come out and say he has lost the election and tell the truth. He can do that today," he said.
The Australian Electoral Commission says counting in the Western Australian seat of Cowan and the South Australian seat of Hindmarsh will continue on Sunday along with the tallying of Senate votes.
In Cowan, Labor candidate Anne Aly leads by 462 votes over sitting Liberal MP Luke Simpkins, while in Hindmarsh former Labor MP Steve Georganas leads by 247 votes over sitting Liberal Matt Williams.
Even so senior Liberal Arthur Sinodinos said the coalition has more primary votes than Labor and is confident of ending up ahead on the two-party preferred basis.
"We're the government, so if anyone has a mandate it's the government," he told ABC television.
He also insists Prime Minister Malcolm Turnbull's leadership is secure having won the election while making agreements with three independents should the government fall short of being able to govern in its own right.
"I don't believe there will be (another) election this year. I believe there will be an election in three years' time," Senator Sinodinos said.
Both major parties must wait another day for any more results in Queensland.