Nervous Liberal MPs say that if the Coalition loses the Canning byelection on September 19 it will be "all over" for Prime Minister Tony Abbott.
Calls for submission on why Heydon should step down
The scandal now engulfing Prime Minister Tony Abbott and his Royal Commission into union corruption takes a turn with the judge he hand picked seemingly on the brink of standing down.
And at the same time, the government's difficulties over same-sex marriage are set to deepen after the federal cabinet on Monday night delayed a final decision on whether to hold a referendum or plebiscite.
Next week's cabinet meeting has been cancelled, meaning the issue could remain unresolved for another fortnight.
Fairfax Media spoke to a number of nervous Liberal MPs on Monday and Tuesday about the government's political fortunes, direction and standing.
One senior government MP said there was a developing view in the party that while in February the Prime Minister had been the focus of concern, now people were asking of the leadership team "where are you?"
"Everyone has had a gutful of the leadership team," the MP said, singling out Mr Abbott, Treasurer Joe Hockey, Employment Minster Eric Abetz and Attorney-General George Brandis.
"We turned Bronwyn [Bishop] into a huge saga, now Dyson Heydon is going to be a huge saga .There is no way he [Heydon] can survive but he has to cut himself loose."
"A loss in Canning and it's all over for him [Mr Abbott]."
The comments came after a Newspoll in the West Australian seat of Canning showed the Abbott government faces a disastrous 10 per cent swing against it in next month's byelection, which will fill the vacancy created by the death of Don Randall.
The Newspoll, taken last weekend and published on Tuesday in The Australian, showed that the Liberal Party would hang on to the previously safe south-eastern Perth but with the margin slashed.
Everyone has had a gutful of the leadership team.
In 2013, Mr Randall easily won the seat with 61.8 per cent of the two-party-preferred vote. According to Newspoll, the Liberal Party can now only claim 51 per cent. From the 2013 election to today, the Liberal Party's primary vote has dropped from 51 to 41 per cent of the vote, while Labor's has jumped from 26.6 per cent to 36 per cent.
A second senior Liberal MP said that leadership chatter had restarted following a horror week for the government last week, though that MP cautioned it was "not like February" when Mr Abbott faced a leadership spill.
"The atmosphere is more reflective, maybe even despairing. There hasn't yet been the sorts of things we saw in the lead up to February," the MP said.
"People left [Parliament] last week like stunned mullets and are not sure what this week will bring. The government's problems run deep."
Assistant Treasurer Josh Frydenberg dismissed the poll results and leadership chatter on Tuesday morning.
"Governments always tend to have a swing against them in byelections," Mr Frydenberg told ABC's Breakfast program.
He also said that former prime minister John Howard trailed opposition leaders Kim Beazley and Mark Latham before winning elections in 2001 and 2004.
"I think Tony Abbott will retain the prime ministership and lead us to victory at the next election."
Mr Frydenberg also praised the Liberal candidate in Canning, 32 year-old Andrew Hastie.
"I think he will do a fantastic job," Mr Frydenberg said.
Another MP said the WA Liberal Party was "quietly confident" it could win the seat and would "out campaign Labor on the ground".
Labor is yet to decide on a candidate. Nominations close on August 20.
Mr Abbott's cabinet met on Monday night and discussed how to proceed on same-sex marriage, hours after Coalition MP Warren Entsch introduced his same-sex marriage bill.
That bill will come before the selection committee on Tuesday evening and is not expected to be brought forward for debate.
The Prime Minister said on Monday that, after days of divisive public debate between cabinet ministers over whether to hold a referendum or plebiscite, that there were a "few loose ends to tie up and that will be dealt with in the next couple of weeks".
Behind closed doors on Monday evening, Mr Abbott and his ministers agreed that a so-called "people's vote" would be held on the issue after the next election.
There was also agreement that there would be no change to the Marriage Act in this term of Parliament, but on little else.
Decisions on the mechanism and specifics of how to conduct the national vote were put off.
Liberal moderates, however, appear to have gained the ascendancy in the push for a plebiscite - which is effectively a national opinion poll - as opposed to a referendum, which requires majority of votes in a majority of states.
Moderates view the push for a referendum as a ploy by conservatives designed to effectively ensure the legalisation of same-sex marriage would not occur.
During an at-times tense cabinet discussion, Mr Abbott and leader of the House Christopher Pyne faced off over whether last Tuesday's extraordinary six-hour party room meeting had, in fact, agreed to either a plebiscite or referendum.
"Almost everyone spoke on a people's vote," one cabinet minister said, adding that "there was no possibility of a referendum."
A second cabinet minister said that "most people understand that it has to be a plebiscite".
A Fairfax/Ipsos poll on Monday had Labor way ahead of the government, 54 per cent to 46 cent. This comes as the Australian Financial Review reported that Liberal MPs are again being sounded out by colleagues over the leadership party. Sources told the newspaper that supporters of both Malcolm Turnbull and Scott Morrison have been taking informal soundings.
Liberal frontbencher Steve Ciobo also played down leadership talk as a side issue.
"In politics there's always chatter around the place," he told Sky News. "There's always conversations."
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