PETER Dutton has asked Malcolm Turnbull to call a party room meeting where he will challenge him for Prime Minister.

The former home affairs minister has tweeted his intentions, believing he has the support of majority of the Liberal party room to be successsful in his attempt to take the top job.

EARLIER: MALCOLM Turnbull has been hit with further blows this morning with two of his Ministers officially resigning.

The Liberals' leadership uncertainty has entered its third day after a shambolic night.

MPs linked to contender Peter Dutton attempted to launch a petition forcing Mr Turnbull into a late night showdown.

It was a fizzer which only managed to antagonise some Liberals.

A furious senior Turnbull supporter told the Daily Telegraph Mr Dutton's side had spread "lying propaganda" in an effort to pressure their colleagues into a vote, including rumours that key minister Mathias Cormann had flipped.

One Liberal MP has reportedly told the Australian Financial Review that the Whip's office has received four complaints from female MPs saying they felt intimidated when asked to sign the petition, which they refused to do.

MPs expect a second leadership spill, following Tuesday's vote won by Mr Turnbull, some time today.

Ministers Michael Sukkar and Zed Seselja have resigned this morning, Sky News reports, while James McGrath resigned last night.

Mr Sukkar and Mr Seselja refused Mr Turnbull's offer to remain as Ministers despite voting for Mr Dutton in Tuesday's spill.

Meanwhile there are serious questions as to whether Mr Dutton, the former home affairs minister, can sit in Parliament let alone become Prime Minister.

Labor has produced an opinion from Brett Walker SC to the effect Mr Dutton is ineligible to sit in Parliament because he has breached a section of the Constitution.

The specific part of S44 prevents MPs from having a direct or indirect pecuniary interest related to a Commonwealth public servant.

Mr Dutton's wife has child care business which benefits from Commonwealth subsidies. Mr Dutton has said his own legal advice is there has been no breach.

But Attorney-General Christian Porter has referred the matter to the Solicitor-General.

Mr Dutton's petition needs 43 signatures to force the Prime Minister to call a party room meeting, but Mr Turnbull may decide he has no choice with his position in such doubt.

If PM does not call a spill imminently, it cannot happen for two weeks, with Parliament going on a fortnight's break.

But it's not clear how many signatures Mr Dutton has managed to obtain, with Liberal MP and Turnbull supporter Jane Prentice saying around nine politicians had signed the letter but Sky News this morning reporting that figure has risen to 25.

Just three Liberals told the ABC they had done so.

The Prime Minister's future hangs in the balance, but he remained stoic on a night of rampant rumour and intrigue, in which the much-discussed petition failed to come out and force a Liberal leadership vote.

Mr Dutton has made it clear he wants another spill today, after losing the first by a narrow margin of 48-35 votes and resigning from his role as Home Affairs Minister.

The backbencher revealed yesterday he was "working the phones" to win the prime ministership.

His letter was circulated to MPs at 6.30pm yesterday but by 8pm, a spokesman for the Government's chief whip Nola Marino ruled out the possibility of a party room meeting for the night.

Governor-General Sir Peter Cosgrove had been due to leave Canberra but The Australian was told he decided it would be best to remain in the capital "at this time".

Ten ministers who backed Mr Dutton in the vote offered to resign on Tuesday, but Mr Turnbull only accept that of Mr Dutton and former international development minister Concetta Fierravanti-Wells.

Assistant to the Prime Minister James McGrath last night went to the PM and insisted Mr Turnbull accept his resignation.

"The people who have for all their lives counted on us to look after them and their families are now questioning our commitment to them," said the Queensland senator in his resignation letter. "Our people feel forgotten, ignored and spoken down to. As a Liberal National Party Senator for Queensland, this is an intolerable situation.

"Like Peter Dutton has said, we must do everything in our power to stop Bill Shorten ever becoming Prime Minister.

Three years ago, Mr McGrath was instrumental in helping Mr Turnbull replace Tony Abbott as Prime Minister.

If more ministers follow his lead in insisting on resigning, Mr Turnbull will be left in a nightmare position.

The list of those who offered to go included Cabinet ministers Greg Hunt, Michael Keenan and Steve Ciobo, threatening the PM's ability to govern.

As Mr Dutton battles to prove his leadership qualities, Labor has thrown a spanner in the works by claiming he may have breached the Constitution and be ineligible.

His wife Kirilly owns and operates two childcare centres, owned by RHT Family Trust, of which the family are all beneficiaries, according to ASIC documents.

The business receives Commonwealth subsidies under the Government's childcare reforms, which came into effect on July 2. It has received $5.6 million in taxpayer-funded rebates over the past eight years, according to The Australian, which are passed on to families.

This could mean Mr Dutton has a "direct or indirect pecuniary interest with the Public Service of the Commonwealth", or a case of an office of profit under the Crown, which would lead to a disqualification from Parliament.

There is no evidence he has breached the Constitution on these grounds, and Mr Dutton has legal advice his business affairs were above board. But Labor has also obtained advice, and says there's a problem.

In a letter obtained by News Corp Australia reporter Claire Bickers, Shadow Attorney-General Mark Dreyfus wrote to Attorney-General Christian Porter, citing advice from barrister Bret Walker declaring Mr Dutton ineligible.

"Mr Dutton was incapable of being chosen for the 45th Parliament and is not entitled to continue to sit," the advice states.

Mr Porter said in a statement last night that he had referred questions over Mr Dutton's eligibility to sit in Parliament to the Solicitor-General.

The Prime Minister told Parliament yesterday he had not seen the legal advice and was not in possession of all the facts.

"The Member for Dickson has advised me he is not in breach of section 44 and I have no reason there to believe he is," said Mr Turnbull.

"As far as the solicitor-general is concerned, the matter has only arisen in very recent times and we are not in possession of all the facts relating to the arrangements between the childcare centre and the member for Dickson's trust."

Labor asked if Mr Dutton had excused himself from cabinet during talks about the childcare funding changes, as he had done in previous governments and Mr Turnbull said he would report back after seeking advice from the cabinet secretary.

Mr Dutton's supporters reacted with fury, with one senior conservative MP telling The Australian: "It is unbelievable that he would threaten the government's majority to try and save his leadership.

"It has scared a lot of members and senators that he would have thrown a member of his team under a bus."

The PM yesterday afternoon held a news conference, flanked by Treasurer Scott Morrison and Finance Minister Mathias Cormann to admit defeat after one of their signature economic reforms - tax cuts for big business - was killed in the Senate.

The embarrassing podium performance outside Parliament House involved an awkward hug from Mr Morrison when asked if he could rule out any leadership ambitions. "This is my leader and I'm ambitious for him," he said as he put his arm around Mr Turnbull.

Support from the pair is vital for Mr Turnbull as he fights to survive.

Mr Cormann was last night under pressure to make a choice between the PM and Mr Dutton. The Finance Minister reportedly told Mr Turnbull he had lost the support of his party room in a meeting, according to The Australian.

However, Mr Turnbull, Mr Morrison and Mr Cormann poured cold water on the policy plans Mr Dutton announced yesterday, particularly his move to remove the GST from power bills, which would mean an automatic 10 per cent reduction.

He also called for "record spending" in the areas of health, education and aged care.

Mr Morrison said such a proposal would cost about $7.5 billion over four years. "That would be a Budget blower, an absolute Budget blower," he said. "And you can make all sorts of promises about how much money you're going to spend, but at the end of the day, you've got to account for it."

Labor Treasury spokesman Chris Bowen called the idea a "crazy thought bubble" that would ­deprive the states of revenue for hospitals.

Mr Dutton's issues with both policy and popularity were highlighted yesterday as he tried valiantly to prove he was just an everyday Australian.

Triple M's Hot Breakfast hosts asked him to detail his career history, background and upbringing so Australians could understand the "down-to-earth" side of him he said they often did not see.

He said he couldn't name his favourite AC/DC song because he said he had not had much sleep. Mr Turnbull had the same reaction on Triple M last year, but instead provided a Mental as Anything song.

Some say Julie Bishop or Mr Morrison or even former Prime Minister Tony Abbott might have a better chance of defeating Labor leader Bill Shorten at election than Mr Dutton.

But Ms Bishop yesterday repeated that she was not "considering or canvassing any of those options". She told Nine she was "focusing all of my energy and attention" on her job as Foreign Minister and as the member for Curtin.

She also downplayed the possibility of a Dutton leadership, saying a number of people who voted against Mr Turnbull have reconsidered their position and that she didn't "envisage" it happening.

"I believe that the Prime Minister has been endorsed by a majority of the party room … and understand that a number of people who didn't vote for him have now said they will back him," she told ABC radio on Wednesday.

She said she was surprised Mr Dutton had challenged Mr Turnbull on Tuesday. "I thought that the interests of the party were to unite behind a set of policies that would be delivered for the Australian people," she told the Nine Network.

"But everybody has a right to stand if they believe that is in the interests of the party and in the interests of the party and in the interests of the country."

She also told Sky News Mr Cormann had backed Mr Turnbull in the vote, after his silence afterwards sparked speculation about who he supported.

"Mathias is very busy focusing on implementing the coalition's policies through the Senate, and I understand he is supporting the Prime Minister and will continue to do so," Ms Bishop confirmed. </s> CANBERRA, Australia (AP) — A government lawmaker said on Wednesday he was planning a second challenge against Australia's prime minister after losing a leadership ballot.

Prime Minister Malcolm Turnbull called on his government to unite behind him after lawmakers in the ruling conservative Liberal Party chose to keep him as their leader 48 votes to 35 in a ballot on Tuesday.

Turnbull surprised his enemies by calling the ballot before his challenger Peter Dutton had had time to lobby colleagues for support.

But Dutton confirmed that he was now sounding out support for a second challenge.

"I am not going to beat around the bush on that, I am speaking to colleagues," Dutton told Melbourne Radio 3AW.

"You don't go into a ballot believing you're going to lose, and if I believe that a majority of colleagues support me, then I would consider my position," he added.

Dutton has dashed Turnbull's hopes of unifying the conservative coalition under his leadership ahead of general elections due by May.

Australia has had years of political instability since Prime Minister John Howard lost power in 2007 after more than 11 years in office. No prime minister has lasted a full three-year term since. They have all been thrown out of power by their own parties in the face of poor opinion polling.

Darren Chester, a minister in The Nationals party, the junior coalition partner, has threatened to take away the government's single-seat majority in the House of Representatives if Turnbull was deposed.

Chester said he and other lawmakers were considering quitting a government that was not led by Turnbull, which could force an election.

"I know of other colleagues who are deeply worried about" Turnbull being overthrown, Chester said.

Another 10 ministers who supported Dutton's challenge have also offered their resignations, but it is not clear how many the prime minister has accepted. </s> Australian Prime Minister Malcolm Turnbull has rejected the resignations of seven cabinet members despite them backing a rival for leadership, the country's foreign minister said on Wednesday, as Turnbull seeks to quell the threat of a renewed leadership challenge.

The Prime Minister on Tuesday survived a leadership bid from Peter Dutton, then Australia's Minister for Home Affairs, in a party room vote.

But the small margin of victory, narrowed by nine cabinet ministers backing Dutton, has stoked expectations that Turnbull will face another challenge in the near future.

Desperate to unite the fractured ruling party, Turnbull has asked the bulk of the cabinet rebels, including Australia's Trade Minister Steven Ciobo and Greg Hunt, minister for health to remain in their posts, Minister for Foreign Affairs, Julie Bishop said.

"A number of people who voted for Peter Dutton have in fact offered their resignations to the prime minister, they've done the right thing, but the prime minister has said that he wants them to remain in the ministry," Bishop told Australian Broadcasting Corporation radio.

Bishop said Dutton and Concetta Fierravanti-Wells, former Minister for International Development and the Pacific, have had their resignations accepted.Turnbull on Tuesday said he asked Dutton to remain his cabinet position but Dutton declined, a move widely seen as a precursor for another challenge as he works to secure the seven votes within the Liberal Party he needs to become the Australia's sixth prime minister since 2009.

Although Dutton has refused to outline whether he intends to challenge Turnbull, the conservative lawmaker on Wednesday began to outline his policy agenda should he succeed in a renewed bid.

"We pay some of the highest prices in the world for electricity and fuel. I think these are the kind of things we should be working on and if we do, I believe people will strongly support the government," Dutton told Triple M Radio.

Dutton's comments suggest that further political instability will continue to afflict the government in the final two days of parliament's sitting before it breaks until September.

Turnbull came to power in a party-room coup in September 2015 when he ousted former premier Tony Abbott who also survived an internal leadership contest before his eventual defeat.

A social liberal and multi-millionaire former merchant banker, Turnbull rode an early wave of popular support but his standing has diminished significantly.

He has struggled to appeal to conservative voters, while progressive supporters have been disappointed as they watched government policies shift to the right as Turnbull tried to appease a powerful right-leaning backbench.

The uneasy unity held sufficiently to secure a narrow election victory in 2016.

However, that fragile peace was broken this week by the weakening of the government's centrepiece energy policy, which had included the imposition of a target of a 26 percent reduction in greenhouse emissions from Australia's energy generators, an issue that has repeatedly divided the government. </s> CANBERRA (Reuters) - Australian Prime Minister Malcolm Turnbull rejected the resignations of seven Cabinet members who backed a rival for leadership, Foreign Minister Julie Bishop said on Wednesday, as he seeks to quell a renewed bid by a conservative challenger.

Turnbull survived a leadership bid from former home affairs minister Peter Dutton in a party-room vote on Tuesday but the narrow margin of his victory heightened speculation that his leadership days were numbered.

Expectations that Turnbull would soon face another challenge, possibly within days, were stoked when eight Cabinet ministers backed Dutton.

Turnbull is desperate to unite the fractured Liberal Party, the senior party in the government coalition. He asked the bulk of the Cabinet rebels, including Trade Minister Steven Ciobo and Health Minister Greg Hunt, to remain in their posts, Bishop said.

“A number of people who voted for Peter Dutton have in fact offered their resignations to the prime minister, they’ve done the right thing, but the prime minister has said that he wants them to remain in the ministry,” Bishop told Australian Broadcasting Corporation radio.

Bishop said the resignations of Dutton and Concetta Fierravanti-Wells, the former minister for international development and the Pacific, were accepted.

Dutton refused Turnbull’s request on Tuesday to remain in Cabinet, a move widely seen as a precursor to another challenge as he works to secure the seven Liberal Party votes he needs to become Australia’s sixth prime minister since 2009.

He had been coy on his immediate plans after his party-room defeat but declared on Wednesday he was working to secure the necessary support.

“If I believe the majority of colleagues support me then I will consider my position,” he said.

Further political instability is now all but guaranteed in the final two days of parliament’s sitting before it breaks until September, potentially upsetting Australia’s financial markets.

Australia’s stock market fell more than one percent on Tuesday, its biggest drop in five months.

Turnbull came to power in a party-room coup in September 2015 when he ousted former prime minister Tony Abbott, who also survived an internal leadership contest before his eventual defeat.

A social liberal and multi-millionaire former merchant banker, Turnbull rode an early wave of popular support but his standing has diminished significantly.

He has struggled to appeal to conservative voters, while progressive supporters have been disappointed as they watched government policies shift to the right as Turnbull tried to appease a powerful right-leaning backbench.

The uneasy unity held sufficiently to secure a narrow election victory in 2016.

However, that fragile peace was broken this week by the weakening of the government’s centrepiece energy policy, which had included the imposition of a target of a 26 percent reduction in greenhouse emissions from Australia’s energy generators, an issue that has repeatedly divided the government. </s> The embattled Prime Minister said he would call the meeting and move the spill motion at 12pm if a letter requesting one, signed by a majority of MPs, was presented to him.

He said he would not stand as a candidate, and would resign both as Prime Minister and as a Member of Parliament.

Malcolm Turnbull is ready to call a party room meeting at midday and stand down as Prime Minister if he receives a petition. Picture: ABC. Picture: Kym Smith

Malcolm Turnbull is ready to call a party room meeting at midday and stand down as Prime Minister if he receives a petition. Picture: ABC. Picture: Kym Smith

"I will treat that as a vote of no confidence and I will not stand as a candidate in the ballot," said Mr Turnbull, who yesterday faced a mass exodus of 13 ministers.

Ms Bishop is reportedly pitching to her colleagues that she is the leader who could win the most seats for the party, telling them she "won't be another man's deputy", according to The Australian.

EXCLUSIVE: Number crunchers tell me early count has Scott Morrison ahead of Peter Dutton and Julie Bishop as next prime minister. #7News

The Foreign Minister's partner David Panton last night told the Herald Sun at Myer's runway show that she would claim the leadership.

"You've heard it straight from the horse's mouth - by tomorrow at lunchtime, Julie Bishop will definitely be Prime Minister," he said.

Asked whether he would be "the first man", he replied: "Just call me David."

Meanwhile, Mr Dutton has released a second legal letter from a lawyer saying he is eligible to sit in Parliament as he faces questions over his wife's childcare business, which receives government subsidies.

Scott Morrison, centre, and Julie Bishop have thrown their hats into the ring for the leadership. Picture: Ray Strange.

Scott Morrison, centre, and Julie Bishop have thrown their hats into the ring for the leadership. Picture: Ray Strange.

And public sentiment towards the government is at a low, with Greens leader Richard Di Natale tapping into the unhappiness by calling the instability a national embarrassment and telling Australia's leaders: "Hang your heads in shame."

Bill Shorten has always lagged behind Mr Turnbull in popularity even as Labor soared in the polls, but would be the nation's preferred prime minister if Mr Dutton were to win the leadership, according to a Roy Morgan poll.

A Reachtel poll found that 55 per cent of voters would be less likely to vote Liberal if the former home affairs minister were in the top job.

When asked yesterday why Mr Dutton was the best option to lead the coalition to victory at the next election, key senator Mathias Cormann ducked the question. "I'm not here to run a campaign for Peter Dutton," he told reporters.

His resignation yesterday and comment that he believed Mr Dutton was the best person to lead the party to the next election was labelled "the death knell" for Mr Turnbull.

Ms Bishop was working the phones yesterday evening, according to Guardian Australia, and had called more than a dozen MPs canvassing support by 7pm. But moderate Liberals said Mr Morrison so far had better numbers than Ms Bishop.

It's a marked turnaround for the Deputy PM, who had repeatedly promised loyalty to Mr Turnbull but has come under increased pressure in recent days from colleagues to declare herself as the third candidate.

A News Corp Australia online poll showed Ms Bishop was the preferred leader for the party among readers with 34 per cent of votes, followed by Mr Turnbull at 30 per cent, Tony Abbott at 17 per cent Peter Dutton at 10 per cent.

But despite Ms Bishop's popularity with the public, the path to the leadership in the party wouldn't be easy. In an earlier piece for news.com.au, Chris Urquhart noted that her moderate position, the questioning of her loyalty and her base in Western Australia - when the marginal seats need to be won on the other side of the country - were major hurdles for her.

There were also reports that Tony Abbott will stand in tomorrow's ballot, with Liberal MPs telling Herald Sun reporter Rob Harris he had "used Dutton all along", but the former prime minister has ruled it out.

Potential deputies include Josh Frydenberg and Steve Ciobo, with reports Health Minister Greg Hunt could stand as Mr Dutton's deputy in the ballot.

'YOU'VE FORGOTTEN EVERYONE BUT YOURSELVES'

Mr Shorten has largely remained quiet as the Liberals implode, but other Labor members have lashed out at the government.

"They're not conservatives, they are vandals," said deputy opposition leader Tanya Plibersek in parliament. "Today is the funeral of the modern Liberal Party."

In a similarly explosive speech, Penny Wong said: "People will remember the famous Menzies speech about the forgotten Australians that the Liberals always get doe-eyed about.

"You know what? You've forgotten every Australian but yourselves. You've forgotten everyone but yourselves."

The nation's disgust over Liberal infighting could, of course, play into Labor's hands at election time.

Liberal MP Tim Wilson described the petition as a "suicide note" for the party.

Speaking to reporters outside parliament yesterday evening, Liberal member for McPherson Karen Andrews said she understands only "one more signature is required".

"I will not stand by after having Parliament adjourned today to have this matter not concluded tomorrow," she said, adding that she would not necessarily back Mr Dutton.

ACT Senator Zed Seselja said there were more than 40 signatures, "certainly around about the mark."

He told the ABC "it would be extraordinary and I would say untenable if we were to say tomorrow that we will leave Canberra without having resolved this issue in the party room."

The NT News shared a powerful front page for tomorrow's paper, with the headline 'HANG YOUR HEADS IN SHAME'.

"Territorians, like all Australians, have had enough of politicians putting their own self-interest ahead of the people they are elected to represent," the paper says. "The events in Canberra this week are nothing short of disgraceful.

"By lunchtime today, we will likely have a new Prime Minister as 85 feuding Coalition MPs have the right to overrule the wishes of millions of Australians."

The front page echoed Mr Di Natale's powerful speech yesterday afternoon, in which he pointed to Australians who couldn't pay their medical bills, the homeless population, young people priced our of education and women who fear going home "because one woman a week is killed at the hands of a violent partner".

"And what have we got? We've got this spectacle. This disgrace. You should be ashamed of yourselves," he shouted across the Senate floor.

"You are so focused on yourselves that you have forgotten what the country has elected you to do, and that is to govern for them, not for you," he said.

"You don't deserve to govern. You deserve to be turfed out. That's what you deserve."

Julia Gillard also weighed into the leadership crisis, saying she could "understand why people would want to go and live in New Zealand given the leadership of the current prime minister".

Speaking at RMIT University, she declined to comment on the looming federal election and said her only advice for Mr Dutton and other challengers was to "drink a lot of water" and "make sure you eat some veggies and get some sunlight". </s> Australian Minister for Home Affairs Peter Dutton, left, leaves after a party room meeting at Parliament House in Canberra, Tuesday, Aug. 21, 2018. Australia's Prime Minister Malcolm Turnbull survived a leadership challenge, defeating Dutton in an internal government ballot that is unlikely to settle questions of his support. (Mick Tsikas/AAP Image via AP) less

Australian Minister for Home Affairs Peter Dutton, left, leaves after a party room meeting at Parliament House in Canberra, Tuesday, Aug. 21, 2018. Australia's Prime Minister Malcolm Turnbull survived a ... more

Australian Minister for Home Affairs Peter Dutton, left, leaves after a party room meeting at Parliament House in Canberra, Tuesday, Aug. 21, 2018. Australia's Prime Minister Malcolm Turnbull survived a leadership challenge, defeating Dutton in an internal government ballot that is unlikely to settle questions of his support. (Mick Tsikas/AAP Image via AP) less

Australian Minister for Home Affairs Peter Dutton, left, leaves after a party room meeting at Parliament House in Canberra, Tuesday, Aug. 21, 2018. Australia's Prime Minister Malcolm Turnbull survived a ... more

Australian Liberal Party deputy leader Julie Bishop, left, and Prime Minister Malcolm Turnbull address reporters at Parliament House in Canberra, Australia, Tuesday, Aug. 21, 2018. Turnbull called on his government to unite behind him after he survived a leadership challenge, defeating a senior minister in an internal ballot that is unlikely to settle questions of his support. less

Australian Liberal Party deputy leader Julie Bishop, left, and Prime Minister Malcolm Turnbull address reporters at Parliament House in Canberra, Australia, Tuesday, Aug. 21, 2018. Turnbull called on his ... more

Australian Liberal Party deputy leader Julie Bishop, left, and Prime Minister Malcolm Turnbull arrive to address reporters at Parliament House in Canberra, Australia, Tuesday, Aug. 21, 2018. Turnbull called on his government to unite behind him after he survived a leadership challenge, defeating a senior minister in an internal ballot that is unlikely to settle questions of his support. less

Australian Liberal Party deputy leader Julie Bishop, left, and Prime Minister Malcolm Turnbull arrive to address reporters at Parliament House in Canberra, Australia, Tuesday, Aug. 21, 2018. Turnbull called on ... more

Australian Prime Minister Malcolm Turnbull address reporters at Parliament House in Canberra, Australia, Tuesday, Aug. 21, 2018. Turnbull called on his government to unite behind him after he survived a leadership challenge, defeating a senior minister in an internal ballot that is unlikely to settle questions of his support. less

Australian Prime Minister Malcolm Turnbull address reporters at Parliament House in Canberra, Australia, Tuesday, Aug. 21, 2018. Turnbull called on his government to unite behind him after he survived a ... more

Australian Prime Minister Malcolm Turnbull address reporters at Parliament House in Canberra, Australia, Tuesday, Aug. 21, 2018. Turnbull called on his government to unite behind him after he survived a leadership challenge, defeating a senior minister in an internal ballot that is unlikely to settle questions of his support. less

Australian Prime Minister Malcolm Turnbull address reporters at Parliament House in Canberra, Australia, Tuesday, Aug. 21, 2018. Turnbull called on his government to unite behind him after he survived a ... more

CANBERRA, Australia (AP) — A government lawmaker said on Wednesday he was planning a second challenge against Australia's prime minister after losing a leadership ballot, ensuring that Australia's political instability continues.

Prime Minister Malcolm Turnbull called on his government to unite behind him after lawmakers in the ruling conservative Liberal Party chose to keep him as their leader 48 votes to 35 in a ballot on Tuesday.

Turnbull surprised his enemies by calling the ballot before his challenger Peter Dutton had had time to lobby colleagues for support.

But Dutton confirmed that he was now sounding out support for a second challenge.

"I am not going to beat around the bush on that, I am speaking to colleagues," Dutton told Melbourne Radio 3AW.

"You don't go into a ballot believing you're going to lose, and if I believe that a majority of colleagues support me, then I would consider my position," he added.

Dutton has dashed Turnbull's hopes of unifying the conservative coalition under his leadership ahead of general elections due by May.

Dutton also used various media interviews on Wednesday to suggest new policy directions, including reduced tax on electricity bills and reduced immigration.

Turnbull suggested he still had the support of a majority of his party.

"The iron laws of arithmetic confirmed my leadership of the Liberal Party," he told reporters on Wednesday at a joint news conference with Treasurer Scott Morrison and Finance Minister Mathias Cormann.

Both ministers also declared their support for Turnbull.

Australia has had years of political instability since Prime Minister John Howard lost power in 2007 after more than 11 years in office. No prime minister has lasted a full three-year term since. They have all been thrown out of power by their own parties in the face of poor opinion polling.

Darren Chester, a minister in The Nationals party, the junior coalition partner, has threatened to take away the government's single-seat majority in the House of Representatives if Turnbull was deposed.

Chester said he and other lawmakers were considering quitting a government that was not led by Turnbull, which could force an election.

"I know of other colleagues who are deeply worried about" Turnbull being overthrown, Chester said.

Another 10 ministers who supported Dutton's challenge have also offered their resignations, but it is not clear how many the prime minister has accepted.

Turnbull said Dutton's was the only senior minister's resignation he accepted. It was not clear if Turnbull had accepted the resignations of junior ministers outside Cabinet.

"What I'm endeavoring to do is to obviously ensure that the party is stable, to maintain the stability of the government of Australia. That's critically important," Turnbull said.

"So the Cabinet ministers, apart from Peter Dutton, of course, who came to me and told me that they had voted for Mr. Dutton in the leadership ballot, have given me unequivocal assurances of continuing loyalty and support," he added. </s> CANBERRA (Reuters) - Australian Prime Minister Malcolm Turnbull’s grip on power slipped further on Wednesday when he was forced to abandon his centerpiece tax policy and a conservative rival in his own party canvassed support for an imminent second challenge.

Turnbull’s legislative agenda crumbled around him this week as he first watered down his main energy policy and then withdrew planned tax cuts for corporations, at the same time as he fought off a growing challenge from former home affairs minister Peter Dutton.

Dutton challenged Turnbull on Tuesday in a vote by the Liberal Party, the senior partner in the center-right government coalition, that likely marked the beginning of the end for Turnbull.

Turnbull won the party-room vote 48-35 but the narrow margin of the victory made another challenge almost certain in a country that has earned a reputation for a revolving door of political leaders, with six prime ministers since 2009.

Dutton, who needs to win over only seven more colleagues to become leader, said he was already canvassing party support for another tilt at Turnbull, possibly as early as this week.

“If I believe the majority of colleagues support me then I will consider my position,” he said.

Deepening speculation about Turnbull’s future, Governor-General Peter Cosgrove canceled travel plans and will remain in Canberra this week, a source familiar with the plans told Reuters.

Cosgrove is British Queen Elizabeth’s representative in Australia and would need to be on hand to swear in a new prime minister if Turnbull was ousted, or to accept Turnbull’s request to dissolve parliament if he decides to call an early election.

The next election is due by May.

Australian newspapers echoed the frustration many voters feel over the constant leadership changes.

“It would be kinder to voters and more in the national interest if Mr Turnbull drove to Yarralumla (Cosgrove’s official residence) and called an election a year early,” The Sydney Morning Herald wrote in an editorial.

“The big risk is that he might be shafted even before he got to the end of the driveway,” it said.

The internecine Liberal Party strife has been a boon for the opposition Labor Party, who find themselves in the enviable position of having to do little more before the next election than sit back and watch their opponents crumble.

Labor used Question Time in parliament on Wednesday to ask seven of the nine Cabinet ministers who voted for Dutton whether they still supported Turnbull.

All seven had tendered their resignations to Turnbull, who refused them in an attempt to show unity and later said he had been given “unequivocal assurances of continuing loyalty”. Dutton and one other opponent were allowed to leave the ministry.

Turnbull’s decision to dump his unpopular plan to cut corporate tax rates to 25 percent from 30 percent was seen as an attempt to curry favor with colleagues.

His plan echoed that of U.S. President Donald Trump but, with record corporate profits and stagnant wage growth, the policy has proved widely unpopular with voters.

“It is clear that the policy was never going to be an election-winning one. There has been some concern within the backbench about policy, it will show them that he is listening,” said Rod Tiffen, emeritus professor of political science at Sydney University.

The upper house Senate rejected the policy on Wednesday and Turnbull said soon after he would no longer pursue it.

“We will not be taking the tax cuts for larger companies to the next election,” he told reporters in Canberra.

Despite Turnbull offering an olive branch, further political instability is all but guaranteed in the final two days parliaments sits before it breaks until September.

The turmoil has upset Australia’s financial markets, with the main stock market down nearly 0.5 percent on Wednesday to a nine-day low.

Turnbull came to power in a party-room coup in September 2015 over former premier Tony Abbott, who also survived an internal leadership contest before his eventual defeat.

A social liberal and multi-millionaire former merchant banker, Turnbull rode an early wave of popular support but he has struggled to appeal to conservative voters and only narrowly won an election in 2016.

Progressive supporters have also been disappointed as they watched government policies shift to the right as Turnbull tried to appease a powerful right-leaning backbench.

Dutton, a hardline conservative who carved out his reputation overseeing Australia’s harsh immigration policy, is unpopular with moderate voters, raising the possibility that a third, centrist candidate might still emerge. </s> Larry Emdur has mercilessly trolled the Liberal party, honing in on an ironic aspect of the leadership spill.

On Friday, hours after Scott 'ScoMo' Morrison toppled Peter Dutton and Julie Bishop to wrestle control of the party away from Malcom Turnbull, the Morning Show host took to Instagram to poke fun.

Larry, 53, asked his fans whether the new rules banning parliament officials from having sex had come into place yet, because everyone was getting screwed on Friday.

After watching the controversial three-way leadership contest end in a spill on Friday, Larry couldn't help pondering the extraordinary policy.

'Has the Bonking Ban started yet?' he asked his Instagram followers.

'Coz it seems like there were a lot of politicians screwing each other today!'

The no-sex rule was put into place by former Prime Minister Malcolm Turnbull, as an attempt to prevent another Barnaby Joyce fiasco.

Barnaby, 51, is estranged from his wife of 24 years Natalie and their four adult daughters as a result of the extramarital affair he had with his then-media adviser, Vikki Campion, 33.

It forced him to quit as Nationals leader and deputy prime minister, and caused Malcolm to rewrite the ministerial code of conduct to forbid ministers engaging in sexual relations with their staff - regardless if they're married or single.

Larry has been making his own memes throughout the entire leadership spill ordeal.

Earlier in the day he shared a picture of Will Ferrell in-costume as the Christmas-loving helper from the movie Elf, smiling excitedly alongside a cheeky quote.

'Only three more Prime Ministers until Christmas!' the Channel Seven personality captioned the image.

Former home affairs minister Peter, an ex-police officer and right-winger, was the driving force behind the move to oust Malcolm after a party backlash against his more liberal policies.

However, Peter's plan backfired as he ended up losing the vote 45-40 to Turnbull ally Morrison - who will now become Australia's fifth prime minister in five years.

Julie Bishop was the third target of Larry's joke, with the Foreign Affairs minister also attempting to 'screw' Malcolm out of his job on Friday. </s> A relative moderate in Australia’s conservative party and an ally of Prime Minister Malcolm Turnbull is poised to succeed him after a vote on Friday that capped days of chaos in the capital and underscored just how turbulent Australian politics have become.

Scott Morrison, who has been serving as the country’s treasurer, is set to become the sixth prime minister in 11 years after the vote by the governing party’s lawmakers. The vote was the second challenge this week to the leadership of Mr. Turnbull — who himself assumed office by leading a party revolt in 2015.

Mr. Morrison, 50, will lead the conservative party, which is known as the Liberal Party, in a general election expected in the coming months. He had backed Mr. Turnbull earlier in the week, but he later emerged as a more moderate alternative to Peter Dutton, a former home affairs minister known for his hard-line stance on immigration. Mr. Dutton mounted the earlier, unsuccessful leadership challenge, on Tuesday.

For Mr. Turnbull, the end came quickly. After months of negotiations, a rift within the party escalated last weekend over an energy proposal from the prime minister, which was meant to reduce electricity prices and address climate change by cutting emissions. Mr. Dutton rallied the party’s conservative wing against him.
Australian MP Peter Dutton claims that Prime Minister Malcolm Turnbull has lost the support of the majority of the Liberal Party and calls for another leadership vote. Turnbull states that he will resign if another spill is called.