PM Mark Rutte hails blow against 'wrong kind of populism' as he sees off Dutch election challenge of Geert Wilders

Work now begins to form coalition without far-right after fractured result

Dutch voters appear to have decided to stick with the familiar and rewarded Prime Minister Mark Rutte’s VVD party a handsome victory over the anti-Islam Freedom Party (PVV) of Geert Wilders to become the largest in the Dutch parliament.

“Tonight the Netherlands, after Brexit and the American elections, said ‘stop’ to the wrong kind of populism,” a jubilant Mark Rutte told his supporters in The Hague.

Although the VVD are expected to lose about 10 seats compared to 2012, with 93 per cent of the vote counted at around 5am GMT, Mr Rutte’s party were projected to win 33 seats. An earlier exit poll had suggested it would be 31. That put Mr Rutte well ahead of three other parties: Wilder's PVV are set to win 20 seats, while the Christian Democrats (CDA) and Liberal Democrats (D66) all both set to win 19 each.

“It appears that the VVD will be the biggest party in the Netherlands for the third time in a row,” Mr Rutte said. “Tonight we'll celebrate a little.”

That margin of the result was surprising, polls predicted a neck and neck race with the PVV. Wilders did not hold a public event around the results but reacted on twitter. “We won seats! Our first gains are a fact! And I’m not done with Rutte by a long shot!” he wrote.

“I would rather have been the largest party,” Wilders said outside his office in parliament. “(But) we gained seats. That’s a result to be proud of.”

Even outside of government, his party's influence on Dutch politics had been enormous, he added. Wilders said he did not understand Mr Rutte’s comment that Dutch voters had said no to the “wrong kind of populists”.

“I don’t know what he means. He is implying there are good and bad populists. I don't see myself as a populist but he is suggesting I am a bad populist and some kind of Nazi.”

A political spat with Turkey allowed the Prime Minister to shine just days before the polls opened. This likely increased the phenomenon known as the premiers bonus, a boost in votes for the incumbent. The fight erupted over the Netherlands' refusal to let two Turkish government ministers address rallies in Rotterdam about a referendum that could give Turkey's President Recep Tayyip Erdogan more powers.

Thirty-four per cent of voters who opted for the party said the Mr Rutte’s handling of Turkey influenced their decision, but over 80 per cent attributed their choice to the economy.

After his victory speech Mr Rutte said that he was going to work hard to make sure those who voted for PVV would feel included.

Leaders from across Europe reacted with relief. Congratulations have come pouring in from Germany, Belgium and France.

Both France and Germany have elections this year in which far-right candidates and parties are hoping to make an impact.

French President Francois Hollande congratulated Mr Rutte on his election success and his “clear victory against extremism”. In Germany, Socialist leader Martin Schulz tweeted. “I am relieved, but we need to continue to fight for an open and Free Europe.”

German Chancellor Angela Merkel’s chief of staff, Peter Altmaier, could not restrain his joy, tweeting: “The Netherlands, oh the Netherlands you are a champion!..... Congratulations on this great result.”

At the VVD election party in The Hague, few people were dancing and a real party atmosphere was lacking. “It’s because we know how difficult it will be to form a coalition,” Liesje Schreinemacher, a 33-year-old lawyer said.

The VVD was also affected by the loss of their coalition partner, the Labour party. That party suffered a historic defeat – projected to lose 29 seats to end up at nine. “This is a bitter pill” leader Lodewijk Ascher told his supporters. “Tonight be are sad together about this dramatic result.”

A new party now leads the left; the night saw a historic win for GroenLinks, the Green Left party led by 30-year-old Jesse Klaver, who are expected to take 14 seats, after an earlier projected suggested it would be 16.

Most pundits expect VVD, D66 and CDA to form a coalition but its remains unclear which other party could fill out the remaining seats. A majority coalition needs 76 out of 150 seats, meaning four parties will likely be required. There are likely to be weeks – if not months – of negotiations, particularly with parties pledging not to work with Wilder’s populist party.

Many voters The Independent spoke to emphasised the importance of this election and a record number headed to the polls. Around 81 per cent were said to have cast their vote, which would be the highest turnout since 1986.