The Morrison government has been plunged into crisis with Victorian MP Julia Banks to quit the Liberals and sit as an independent. 

Ms Banks dropped her bombshell on Tuesday as Prime Minister Scott Morrison was holding a media conference to say he would announce the first surplus since the global financial crisis and bring forward the federal budget to April 2. 

Her defection means the prospect of a referral of Home Affairs Minister Peter Dutton to the High Court is a live political option.

It also raises Labor’s hopes of legislating a new anti-corruption watchdog from the opposition benches and Parliament forcing the evacuation of all children from Nauru. 

However, Ms Banks, who left the door open to contesting the next election as an independent, pledged to offer the Morrison government confidence and supply. That means she would not support a no-confidence motion that could trigger an early election or block the April 2 budget bills. 

Banks slams ‘reactionary right wing’

In a two-minute statement to the House of Representatives on Tuesday, Ms Banks slammed the Liberal Party’s “reactionary right wing” for dumping Malcolm Turnbull. 

“Effective immediately, I will serve as an independent representative,” she said. 

“In the New Year, I will make a decision about my future career path.” 

A corporate lawyer, Ms Banks announced after the August leadership coup that toppled Mr Turnbull that she would not contest the next election. She has subsequently remained the subject of speculation she might split from the Liberals.

“The gift of time and reflection has provided some clarity regarding the brutal blow against the leadership,” she said on Tuesday.

“Led by members of the reactionary right wing, the coup was aided by many MPs trading their vote for a leadership change in exchange for their individual promotion, preselection endorsements, or silence. Their actions were undeniably for themselves, for their position in the party, their power, their personal ambition.

Not for the Australian people who we represent, not for what stood for 2016 election, not for stability and disregarding that team work and unity delivers success.

Ms Banks said the “aftermath of those dark days in August … laid bare the major parties’ obstructionist and combative actions and internal games”.

In a later statement, she accused the Liberal Party of losing its way.

“My sensible centrist values, belief in economic responsibility and focus on always putting the people first and acting in the nation’s interest has not changed,’’ she said.

“The Liberal Party has changed, largely due to the actions of the reactionary and aggressive right-wing who talk about and talk to themselves rather than listening to the people.

State of play

The Coalition now has just 73 votes in the 150-seat Parliament and must rely on independents to pass laws.

Speaker Tony Smith takes the Coalition’s tally to 74, but he does not traditionally vote on legislation.

Mr Smith could use a casting vote in the event of a tie (for example, 74-74) but the speaker’s vote is traditionally used to maintain the status quo or to vote down contentious legislation.  

Labor has 69 MPs while the crossbench will consist of seven independents. That means Labor can pass legislation with the support of five independents (and, therefore a majority of 74 votes).

It can also suspend standing orders and bring on debate on a private members’ bill such as laws to prohibit discrimination against gay students in schools or an anti-corruption commission.

This would be a rare and unusual event.

High Court referral looms for Dutton 

With the government further in minority territory, the prospect of a referral of Mr Dutton to the High Court is a real possibility.

Labor and the cross bench would require a simple majority – 74 votes – to refer him to the High Court over claims he could be in breach of the Section 44 of the Constitution. 

Previously, Labor came within one vote of the High Court action. At the time, Ms Banks was reported to be annoyed with having to save Mr Dutton after his conduct during the leadership coup.

On an anti-corruption commission …

Ms Banks could also bolster Labor’s hopes of legislating for an anti-corruption commission and demanding children are removed from Nauru.

However, to suspend standing orders and debate the legislation, the Labor Party would need an absolute majority – 76 votes.

That rule applies regardless of MPs’ absence for medical or other reasons. 

For example, Mr Dutton is on medical leave because he ripped his bicep off his bone in a DIY mishap.

That means Labor cannot legislate for an anti-corruption watchdog if Mr Dutton extends his sick leave. But it can vote to refer him to the High Court. 

Any such referral might raise the real prospect of an early election because it would reduce the Coalition’s numbers to just 72 of the 150 seats.