Friday's leadership challenge is set to be a three-horse race between Dutton, Morrison and now Julie Bishop

View of Parliament House from Commonwealth Avenue Bridge.

Australia looks set to have its fifth prime minister in six years. You can follow all the latest developments in our live coverage below. The key points.

  • It looks all over for Malcolm Turnbull. He is awaiting a petition signed by a majority of Liberal MPs (at least 43) to trigger a partyroom meeting, which he’ll hold tomorrow at midday.
  • If a spill of the leadership is called by partyroom vote, Turnbull will not stand for the leadership again, leaving the way open for a contest between Treasurer Scott Morrison, former Home Affairs minister Peter Dutton and now deputy leader and Foreign Minister Julie Bishop.
  • It is unclear how the numbers in the partyroom now stack up for the candidates.
  • Turnbull is awaiting clarity from the solicitor-general on Peter Dutton’s eligibility to sit in parliament, which is under question because of his interests in childcare businesses that get government funding. Turnbull says this is to avoid risking a constitutional crisis, but it also buys time for Scott Morrison to lobby for support.
  • The Coalition successfully managed to shut down proceedings in the House of Representatives for the day. With Parliament due to rise today, the House is now adjourned until September 10.

  • 4.46pm: The ABC says it has confirmed Julie Bishop will contest the leadership and “is pitching to her colleagues she is the candidate who could save the most seats at the next election”. That sounds a bit like Rudd in June 2013 during the terminal days of Labor. They were going down, it was such a question of how many of the crew could be saved. After surviving the entire terms of the Abbott and Turnbull governments, the Liberal deputy’s offering herself up as the party life raft.

  • 4.21pm: Tony Abbott appears to have just quashed the stalking horse theory, ruling himself out in any ballot. That said, a bunch of MPs backing the PM yesterday now don’t. A day is now a long time in Australian politics. And this is the guy who promised “no wrecking”.
    • 4.21pm: Sky News reports the petition Turnbull wants to see before he’ll call the party room meeting has been withdrawn by the Dutton side. They argue chief whip Nola Marino has the power to call the meeting. But she’s said no. Stalemate. The arguments over political process among commentators are now starting to sound like the finer points of cricket sub-clauses. Just bowl someone.

    • 4.10pm: Fairfax Media reports deputy Liberal leader and Foreign Minister Julie Bishop – one of the few ministers left in the Turnbull government – sounding out colleagues to throw here hat into tomorrow’s leadership spill. History buffs might like to remember that the 2009 leadership ballot against Turnbull was a three-way contest between Tony Abbott (35 votes), Turnbull (26) and future treasurer, Joe Hockey (23). Hockey eliminated, but enough of his votes went to Abbott to make him leader 42-41.

    • 3.59pm:After a pretty fiery debate in the Senate over Labor’s no-confidence motion, the government has survived thanks to the support of crossbench senators such as Pauline Hanson, with the motion going down 31 for and 35 against.

      Greens leader Richard di Natale was particularly swingeing. Here’s a sample:

      It’s a disgrace. It’s utterly shameful. We haven’t had a stable government in this country for a decade now.

      I’ve got a 10-year-old boy, he’s seen half-a-dozen different prime ministers. We have politicians in this joint who are more concerned about themselves, about their own self-interest, than they are with governing the country.

      Just think, while the Liberal Party has been tearing themselves apart. We’ve got 100% of NSW that’s in drought right now, we’ve got the Great Barrier Reef on the brink of collapse, we’ve got floods in India. We’ve got a 12-year-old girl who is setting herself alight in Nauru. We’ve got kids who are in a catatonic state because they’ve given up hope, locked away in those offshore hell-holes.

      What’s the Liberal party doing? Focussing on vengeance. On payback.

    • 3.20pm: Backbencher Tim Wilson calls the leadership spill petition a “suicide note”. Everyone’s finding their voice ahead of tomorrow’s showdown

    • 1.41pm: Sky News reports there are now 37 names on the petition to call a partyroom meeting. 43 are required.

    Malcolm Turnbull will stand aside if there is a successful spill of the leadership tomorrow

    • 1.09pm: Malcolm Turnbull has spoken. The key points:

      • If he gets a petition from a majority of MPs (43) he intends to call a partyroom meeting tomorrow at midday.

      • However, Turnbull says he awaits legal advice from the solicitor-general on the eligibility of Peter Dutton to sit in parliament, which has been questioned because of his childcare business interests that receive money from the federal government.

      • Turnbull says this is to avoid the potentially huge ramifications of executive decisions being made by someone who is not eligible to sit in parliament. However, it also helps the cause of Scott Morrison who now has extra time to try and build support as a leadership candidate.

      • He also said he would quit his seat if he loses office, which would trigger a by-election in Wentworth if his replacement doesn’t call a general election immediately.

      “When the partyroom meeting is called — if the motion is carried, I will treat that as a vote of no confidence and I will not stand as a candidate in the ballot,” Turnbull said.

      Looking relaxed but sounding resigned to his fate, Turnbull added: “The government that I have led has been a very effective one. We’ve achieved an enormous amount — economic reform, social reform.

      “The cabinet has worked very cohesively and confidentially. The reality is that a minority in the partyroom supported by others outside the parliament, have sought to bully, intimidate others into making this change of leadership that they’re seeking. It is a — has been described by many people … as a form of madness, and it is remarkable that we are at this point, that only a month ago on the public polls we were just a little bit behind Labor, and on our own polls a little bit ahead.”

      More here.

    • 12:48pm: The Australian dollar has been getting smoked, with traders selling it off amid the political chaos.

      Sean Callow, Westpac currency strategist, said: “The Aussie’s clear under-performance against G10 currencies today — and indeed since the leadership spill on Tuesday — certainly points the finger at the leadership battle and fear of a snap election as the culprit for its slide, given the only data we have had since Tuesday was strong.”

      Here’s the chart:
    • Parliament is shutting down

    • 11:56am: In a stunning development, the Coalition has shut down proceedings in the House of Representatives while the Liberal leadership is sorted out. This means there’ll be no Question Time today — and as Labor’s Tony Burke pointed ahead of the vote in the chamber, it was because “they don’t know who the prime minister is”.

      With Parliament due to rise today anyway, the House is now adjourned until September 10th.

    • 11:47am: A quick SWOT comparison between Dutton and Scott Morrison as potential prime ministers:


    • STRENGTHS: The Coalition appears to be in deep trouble in Queensland and Dutton might be able to shore up support in some seats. Broad experience across immigration and national security. Can carry conservatives whose disillusionment with Turnbull is the source of all the current problems.
    • WEAKNESSES: Labor will attack his record as health minister. Seen as the instigator of chaos. Low recognition.
    • Morrison

    • STRENGTHS: From Sydney, where there are a large number of marginal seats. Strong record as immigration minister and has grown as Treasurer, showing a strong grasp of the different moving parts of the economy and presiding over a record run of job creation.
    • WEAKNESSES: Brusque style. Completely tied up with the deeply unpopular company tax cuts which he has championed. Also needs to manage conservative MPs who may see a Morrison-led government as a continuation of the Turnbull era.
    • 11:35am: PARLIAMENT COULD BE CANCELLED FOR THE DAY: Tony Burke, leader of opposition business, has risen in the chamber and said the government is seeking to cancel the day’s proceedings “because they don’t know who the prime minister is”.

      Absolute. Chaos.

    • 11:11am: Scott Morrison is now the hot favourite with the bookies to become the next leader of the Liberal Party. Via Sportsbet:
    • 10:58am: Here’s a refresher on what a leadership spill is and how it works.

    • 10:35am: Sky News reports that Treasurer Scott Morrison will stand for the leadership of the Liberal Party. This is a huge development. Morrison could potentially take Turnbull’s supporters and also court conservative supporters of Dutton.

    • 10:28am: Time for a reminder to be careful in rushing to judgement about the implications of Peter Dutton’s perceived unpopularity. From BI earlier:

      Voters, largely, think they’re all a bunch of bastards and it’s just a matter of what particular brand of bastard they want to put in charge.

      This is not in any way to suggest Dutton would be a sure-fire vote-winner if he took over. It’s rather a timely reminder that understanding how voters may react to different political leaders and strategies has become increasingly complex — and to be wary of political prognostication, because self-appointed experts appear to be getting things hopelessly wrong a lot of the time.

      More here.

    • 10:23am: Labor has moved in the House of Representatives to have Peter Dutton referred to the High Court to determine if he is in breach of section 44 of the constitution. There was a division on the floor and it was defeated by a single vote.

    • 9:55am: Simon Thomsen writes:

      In 12 months of high farce in Canberra, perhaps it would be fitting if Dutton were to win the Prime Ministership, only to be tossed out of parliament by the High Court over whether he’s breached section 44 of the constitution.

      If you’re coming in cold, here’s the short version: Dutton’s family trust received more than $5.6 million in Commonwealth funding since 2014. The Constitution prevents politicians from receiving benefits from the state.

      Dutton says everything’s fine and has legal advice saying so. But everyone gets legal advice. That’s why we have courts – to sort out those opinions. But this issue has been bubbling away for several years, gaining traction again as Dutton looked poised to grab the top job.

      Constitutional expert George Williams has cast his eye over the advice Labor got from silk Bret Walker and thinks this has to go to the High Court. But parliament has to do that. And of course Labor will make hay with PM Dutton over the issue.

      And that means the MPs who just appointed a new boss would need to now get his references checked by the High Court having just given him the job.

      The Turnbull government referred the matter to the solicitor-general.

      The stakes are now incredibly high.

      And how can you lead the nation with a cloud over your head about whether you’re legally entitled to be there?

      We are heading into seriously uncharted waters.

      This could make 1975 and Whitlam look like a doddle.

    • 9:50am: Cormann has come to both bury and praise his leader:

      I believe that Malcolm Turnbull has been and is a great Prime Minister. I believe that he will go down in history as having secured amazing achievements for Australia. There’s no question that Malcolm Turnbull’s plan for the economy, for jobs in relation to our national security, that we all have been part of implementing, has left the country stronger and in a better position.

      No one worked harder than Cormann to try and steer the government’s legislation through the Senate, but in the end, even he failed. And with it, his boss.

    • 9:35am: Mathias Cormann, a key Turnbull backer, has withdrawn his support for the PM, along with Michaelia Cash, and Mitch Fifield. They want a “transition” in the leadership.

      “It’s with great sadness and a heavy heart that we went to see the Prime Minister yesterday afternoon to advise him that in our judgement he no longer enjoyed the support of the majority of members in the Liberal Party party room and that it was in the best interests of the Liberal Party to help manage and orderly transition to a new leader,” Cormann said.

      But the fact that they did this yesterday and the PM is holding on this morning is telling.

      “We have had a further meeting with the Prime Minister this morning, all three of us, to confirm that we believe that there should be a party room meeting to resolve the issue of the leadership of the Liberal Party, to provide certainty around the support for the leader of the Parliamentary Liberal Party and all of us tendered our resignation to the Prime Minister,” Cormann said.

      He says he believes Dutton is the one to support as leader and “can’t ignore reality”.

      The now former Finance Minister keeps repeating that he “did not want to be here in this position”, saying he was surprised by Tuesday’s spill.

      “I, like others, was taken by surprise and I guess the reason we are here now is because that crystallised the views of the party room at that point… including five Cabinet ministers who supported Malcolm on Tuesday, indicating to me that they were of the view that there needed to be a change in the leadership,” he said.

      Cash says it became clear to her yesterday that Turnbull no longer had the confidence of the party room. She met the PM and “urged him to call a party room meeting. My opinion in that regard has not changed overnight”.

      Fifield wants the issue resolved and “a resolution as quickly as possible”.

    • 9:09am: OK, let’s catch our breath. A number of senior government figures, including Treasurer Scott Morrison, Foreign Minister Julie Bishop and Nationals leader Michael McCormack have been in to see the PM. It’s all starting to feel like pre-monsoon season in the Top End. Everyone’s a little on edge, and you know something has got to give and it’s going to break soon, don’t know when but would welcome the relief. Both sides appear to be trying to work the psychological angles. Let’s call it democracy poker. Who’ll fold first?

    • 8:59am: The punters have spoken. It’s Dutton.
    • 8:55am: What price leadership? The ABC reports Corangamite MP Sarah Henderson from Geelong was offered a frontbench position if she came across to the Dutton side. She declined, saying: “To be rewarded for an act of treachery would be a terrible thing.”

    • 8:20am North Sydney MP Trent Zimmerman (a moderate), who’s running commentary for the Turnbull camp, says he’s not aware of any party room members who’ve changed their views since Tuesday’s vote. The three ministers who resigned overnight simply reconfirmed their position having already attempted to resign then. Zimmerman is “confident” Turnbull has the numbers. He also added that Abbott is acting out of “sheer, blind revenge”.

      After turning down Dutton’s request for a meeting, the challenger will need to show he has the backing before the PM will act and bring the party room together again.

    • 8:14am: Challenger Peter Dutton faced the media for 26 seconds to say this:

      I’m going to address the media later on. As I put out, by way of statement earlier, earlier this morning I called the Prime Minister to advise him that it was my judgement that the majority of the party room no longer supported his leadership.

      As such, I asked him to convene a meeting of the Liberal Party at which I would challenge for the leadership of the parliamentary Liberal Party. Thank you very much.

      And with that he walked away.

    • 7:58am: Dutton thinks he has the numbers. He called Turnbull seeking another party room meeting, but was apparently turned down.

    • Former Home Affairs minister Peter Dutton has been openly campaigning for support to replace Malcolm Turnbull but there is a chance that someone like Treasurer Scott Morrison or Foreign Minister Julie Bishop could stand as a unity candidate.

    • The party is hugely divided but it is *not clear* Dutton has the numbers to topple Turnbull. Matters were complicated yesterday by the prime minister saying that ministers who offered to resign after voting against him in Tuesday’s ballot had promised to support him as leader.

    • Dutton was circulating a petition to call a meeting of the parliamentary Liberal party last night to challenge Turnbull for the leadership again but it failed to come off. This shows Dutton’s support is far from overwhelming.

    • Dutton lost Tuesday’s ballot 48-35, meaning he needed to turn seven more MPs to secure a majority. But if Turnbull has managed to regain the support of four Cabinet colleagues, Dutton’s task becomes much more difficult.

    • A scenario where someone other than Dutton replaces Turnbull is a possibility. Turnbull’s leadership is mortally wounded and he could choose not to stand, instead supporting someone like Scott Morrison as his successor. This would put Turnbull’s numbers behind Morrison and likely take of Dutton’s conservative supporters. Another option is Julie Bishop.

    • As leader Morrison would be able to continue the government’s narrative on job creation and the continuing growth in the economy. He is however closely associated with the deeply unpopular plan to cut company taxes, the signature policy that was finally jetissoned yesterday.

    • In interviews yesterday Dutton proposed cutting GST from power bills for families and pensioners, a plan rubbished by Morrison who said it would be a $7.5 billion hit to the federal budget.

    • Turnbull also acted yesterday to sow doubt over his challenger’s position by revealing he has asked the solicitor-general for advice on whether Dutton may have breached the constitution by taking a profit from the crown through his interests in childcare facilities that receive payments from the government.

    • Turnbull explained that Dutton had told him he had legal advice that there was no problem with the childcare interests — but the PM added he had not seen the advice.

    • Of course there’s a chance Turnbull could also cling on, but his party is catastrophically divided and the undermining of his leadership would continue and lead to further deterioration in polling support.

    • Assistant Minister to the Prime Minister James McGrath formally resigned to Turnbull last night. He was one of the ministers whose resignation Turnbull had not accepted earlier this week. “Our people feel forgotten, ignored and spoken down to. As a Liberal National Party senator for Queensland, this is an intolerable situation,” McGrath wrote in his resignation letter.

    • A critical player is Finance Minister Mathias Cormann, who has been one of the Turnbull government’s chief policy advocates and led policy negotiations in the Senate and been doggedly loyal to the PM — but whose best friend in the parliament is Peter Dutton. Yesterday Cormann was unequivocal in his support for Turnbull.

    • Nationals MP Kevin Hogan, from the bellweather seat of Page, based around the city of Lismore in Northern NSW, has come out to say he’ll sit on the crossbench if there’s another leadership change. He’ll support the government in supply and confidence motions, but all else is “case by case”. Hogan says he has to speak up and say he doesn’t condone another change. “This is about a process that we have seen for 10 years now that I think is undermining the faith our public has in our democracy,” he said. Page has gone with the government for nearly 30 years now, so with the government in trouble, Hogan is front of the firing line.

    So in short, here’s what’s going to happen: ¯\_(ツ)_/¯

    We’ll have live updates here through the day.

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