Australian Prime minister Malcolm Turnbull this afternoon officially starts an exhausting 55-day election campaign which potentially has two nightmare outcomes for him.

The first would be outright defeat by Bill Shorten, who wants the July 2 poll to deliver Labor its first clear election victory since 2007.

The second would be a hung Parliament with neither Labor nor the Coalition holding enough seats in the House of Representatives to form a government - a repeat of the 2010 result.

It will be, in the words of one analyst, "a damn close run thing".


Neither outcome would justify Turnbull's successful move against Liberal Prime Minister Tony Abbott last September, and sections of his party would react angrily.

Abbott will be watching carefully but has given Turnbull an assurances he will not sabotage the official campaign.

However, Abbott believes he remains electorally marketable and intends to be active outside his seat of Warringah, going to marginal seats where he has been invited by the local member, or effectively inviting himself to drop in and help.

Yesterday he appeared with his cycling mate and his Defence Minister Kevin Andrews in his Victorian seat of Menzies. This week he will travel through Queensland, where both Turnbull and Shorten also will be campaigning.

This election is expected to be so tight a vast number of factors could influence the result.

One is the fact 23 sitting MPs have left Parliament before a single vote has been cast.

They have retired or lost preselection, and the absence of their personal appeal to voters makes some predictions harder.

The Government currently has 90 of the 150 Lower House seats, and could lose power if it lost 15 of those seats. There are some Coalition MPs who believe that is possible.

Labor has 55 seats and there are five crossbench MPs.

In New South Wales alone there will be close attention to the Government-held seats of Eden-Monaro, New England, Lindsay, Macarthur, Macquarie, Barton, Patterson and Richmond.

Countering that, the Coalition is expected to regain Fairfax following Clive Palmers decision to quit, and will campaign strongly in Victoria and South Australia.

1 All 150 MPs and 76 senators will face the voters
2 To win majority government the coalition or Labor needs to win 76 seats in the House of Representatives
3 The coalition goes into the election holding 90 Lower House seats; Labor has 55
4 Labor needs to gain 21 seats on a uniform swing of 4.3 per cent from the 2013 election to win majority government
5 The latest round of opinion polls has the parties 50-50

Independent polling analyst Andrew Catsaras believes there is a 60 per cent chance of a hung Parliament.

"Turnbull should have cruised in, now he might just scrape back," said Catsaras. "This will be a damn close run thing."

He estimates the Coalition has a 60 per cent chance of winning outright, and the ALP a 40 per cent chance.

His projection is the Coalition's chances of victory are 30 per cent as a majority government, and 30 per cent as a minority government.

For Labor, Catsaras said it had a 10 per cent chance of majority government and 30 per cent as a minority government.

Opinion polling has consistently found that the Coalition and Labor have an equal share of the two-party preferred vote, while Turnbull has always outpointed Shorten both as preferred Prime Minister and on voter satisfaction with his performance.

However, the double dissolution election - in which all House of Representatives and Senate spots will be contested - complicates electoral calculations.

In a regular election only half the Senate seats are at stake. A double dissolution halves the quota of votes needed to be elected and could produce more crossbench independent and micro party senators than the eight currently there.

A third unhappy outcome for Turnbull would be he won government but did not have the combined House of Representatives and Senate numbers to pass his Australian Building and Construction Commission legislation - the formal reason for the election - in a joint
sitting of both houses.