Canberra: Australian Prime Minister Julia Gillard's wafer-thin ruling majority became even more fragile on Thursday after the conservative opposition backed out of a deal over the prized job of parliamentary speaker.

Gillard's Labor won a second term with the support of three independents and one Green lawmaker after dead-heat August 21 elections, giving the party control of 76 seats in the 150-seat lower house.

But Gillard must now sacrifice one lawmaker to be non-voting speaker after the opposition backed down on a deal to ensure the voting numbers remained balanced, prompting an angry response from key independent Tony Windsor.

"Their game plan now is to destroy this parliament," he said of the opposition. "It was always going to be fragile and it required a bit of goodwill on both sides." It means Gillard will have only one vote to spare in the House of Representatives, further weakening her control of the first minority government since World War Two. "I view this to be an extraordinary set of events," Gillard told reporters.

Opinion polls show voters do not expect the government to last a full three-year term, with the slender majority also adding to uncertainty over plans for a 30 percent profits-based tax on miners and a policy to price carbon emissions.

While financial markets have been largely unmoved by the political upheaval, leading business lobby groups have called for the government to move quickly on major policies including a price on carbon to smooth investment plans.

The new parliament meets on Tuesday.

Opposition backs out

Australian Prime Minister Julia Gillard's wafer-thin ruling majority became even more fragile on Thursday after the conservative opposition backed out of a deal over the prized job of parliamentary speaker.

Gillard's Labor won a second term with the support of three independents and one Green lawmaker after dead-heat August 21 elections, giving the party control of 76 seats in the 150-seat lower house.

However, Gillard must now sacrifice one lawmaker to be non-voting speaker after the opposition backed down on a deal to ensure the voting numbers remained balanced, prompting an angry response from key independent Tony Windsor.

"Their game plan now is to destroy this parliament," he said of the opposition. "It was always going to be fragile and it required a bit of goodwill on both sides." It means Gillard will have only one vote to spare in the House of Representatives, further weakening her control of the first minority government since the Second World War.