Malcolm Turnbull to challenge Tony Abbott for Liberal Party leadership [Video]

UPDATE: Prime Minister Tony Abbott has confirmed a party room ballot for both the leadership and deputy leadership will take place later this evening. It is believed the ballot will be held around 9pm AEST.

"I will be a candidate and I expect to win," Mr Abbott said.

"You can trust me to deliver a stronger economy and a safer community.

"This destabilisation has to stop. I firmly believe that our party is better than this, that our government is better than this and, by God, that our country is so much better than this."

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Communications Minister Malcolm Turnbull has confirmed he will challenge Prime Minister Tony Abbott for the leadership, just hours after Mr Abbott dismissed leadership speculations in South Australia.

Announcing his resignation from Cabinet, Mr Turnbull told reporters in Canberra that he met with the Prime Minister earlier today to request a leadership ballot.

“This is not a decision that anyone could take lightly. I have consulted with many colleagues...and this course of action has been urged on me by many people for a long period of time,” Mr Turnbull said during the press conference.

Pointing to the party’s current incapability of providing “the economic leadership our nation needs” and the “economic confidence that businesses need”, Mr Turnbull said the party would certainly lose the next elections if Mr Abbott continued as PM.

“We have lost 30 news polls in a row. It is clear that people have made up their mind about Mr Abbott’s leadership.”

It is believed that Mr Turnbull has the numbers for a successful bid for the leadership, with the ABC reporting that Foreign Minister Julie Bishop was “pivotal” in today’s plays. It was also reported that Christopher Pyne, who has denied his 'involvement' so far, was concerned that South Australia would go if Mr Abbott remained the Prime Minister.

According to The Guardian, there is speculation that the ballot will be held tomorrow morning, although no meeting has been confirmed yet. Ministers backing Mr Turnbull are reportedly also ready to submit their resignation if Mr Abbott rejects the ballot.

David Speers of Sky has reported that Mr Abbott is gathering his troops, including Eric Abetz, Mathias Cormann and Kevin Andrews, to prepare for his campaign.

Mr Turnbull was leader of the opposition before being voted out and replaced by Mr Abbott in 2009 following a leadership spill. He made the announcement after Monday's Question Time.

Call for leadership spill before Canning by-election

With the Canning by-election taking place on Saturday, Mr Turnbull expressed regret at the timing of his announcement, but said it was necessary: "There are few occasions that are entirely ideal for tough calls and tough decisions like this. The alternative if we were to wait and this issue, these problems were to roll on and on and on, is we will get no clear air.

"The fact is we are maybe 10 months, 11 months away from the next election. Every month lost is a month of lost opportunities. We have to make a change for our country’s sake, for the government’s sake, for the party’s sake."

Mr Abbott's leadership has been closely linked with the Canning by-election, with various reports noting in the last few weeks that a swing away from the Liberal Party would fuel tensions for Coalition - tensions that would effectively put Mr Abbott's Prime Ministership to the test.

"The question is now if they lose the seat is it because they changed leader, is it because it's Malcolm Turnbull," ABC's election analyst Antony Green said Monday, adding that the Liberal candidate in Canning may have "given up doorknocking for today".

Mr Abbott and Opposition leader Bill Shorten are expected to make statements soon.

Watch Malcolm Turnbull's full announcement in the video below: