The 30-point proposal was submitted by regional grouping Compromis in a last-ditch bid to get parties to agree and avoid leaving the eurozone’s fourth-largest economy without a fully functioning government for any longer.

But as the day wore on party leaders either rejected it or accused others of torpedoing the document, and the main opposition Socialists (PSOE) — who were tasked by the king to form a government following the inconclusive December election — said they had given up.

“We are heading to new elections,” PSOE chief Pedro Sanchez told reporters after meeting King Felipe VI, who is preparing to issue a statement expected to make clear whether there is any hope for a deal, or whether new polls will be held.

Sanchez said he had told the king that the Socialists and their allies had insufficient parliamentary seats to get through the obligatory vote-of-confidence.

– ‘Still time’ –

The tumult comes more than 18 weeks after the December election resulted in a hung parliament and forced parties into talks on forming a coalition, which would be a first for Spain since it returned to democracy following the death of dictator Francisco Franco in 1975.

But they were unable to come to a deal, and the king started a third and last obligatory round of consultations with party leaders on Monday which were due to end Tuesday evening, after which he was to issue his statement.

Then unexpectedly, Compromis submitted its proposal.

The Socialists said they had accepted much of the document, which includes measures to fight corruption and poverty.

But they requested that any future government be broadly Socialist, rejecting the idea of a fully-fledged coalition — a demand that Compromis and other left-wing parties found unacceptable.

“The PSOE cannot expect us to give them our votes for free,” said Compromis lawmaker Joan Baldovi, who nevertheless refused to accept that the coalition talks had failed and called on the Socialists to reconsider.

“There is still time… We extend our hand, I have my phone on and I won’t switch it off all night.”

Despite this, all bets now are that the king will call a new vote for June 26 under an official electoral timeframe.

This means Spaniards will return to the polls just six months after the December vote, which upended the country’s traditional two-party system as voters weary of austerity, corruption and unemployment flocked to new groupings.

The Socialists have been knee-deep in negotiations to try to form a government after acting Prime Minister Mariano Rajoy, whose conservative Popular Party came first in December but lost its majority, failed to drum up enough support.

Sanchez managed to strike a deal on a government with upstart Ciudadanos — which came fourth in the election — but the two parties had too few seats in parliament to win a vote of confidence.

Sanchez then tried to enlist the support of Podemos, whose 65 parliamentary seats would have got it through, but failed — prompting the current political paralysis.

– Socialists blame Podemos –

At a press conference that sounded like a public goodbye — he thanked the media for their work and his allies — Sanchez placed much of the blame for the failure to form a government on Podemos.

The party led by the charismatic Pablo Iglesias that was born just over two years ago from the Indignados anti-austerity movement, has made no secret of its desire to supplant the Socialists as Spain’s main left-wing grouping.

“Mr Iglesias never wanted a Socialist prime minister,” Sanchez said, accusing him of having “closed the door” to a reformist government and offered a “lifeline” to Rajoy and the conservatives.

At an earlier press conference, Iglesias accused Sanchez of saying “no” to everything.

Research polls have suggested that fresh elections will do little to change the December outcome.

Rajoy’s conservatives could gain ground, while Podemos and its allies may lose a little as some of the five million people who voted for the far-left upstart accuse it of torpedoing coalition talks with its refusal to back the Socialists.

By and large, though, parties could have to sit down again and negotiate a coalition following a fresh election.