Morgan has published results from last weekend’s face-to-face polling which shows Labor’s two-party lead at 51.5-48.5, their weakest result from this series since July 2006. Labor’s primary vote is down 2.5 per cent on last week to 41 per cent, the Coalition is up the same amount to 42.5 per cent and the Greens are steady on 9 per cent. Morgan has chosen to run as its headline figure a separate phone poll conducted from a smaller sample (571 rather than 830) over the past two nights, which has the Coalition leading 52-48 from primary votes of 36 per cent for Labor, 46 per cent for the Coalition and 11.5 per cent for the Greens. The purpose of this poll would have been to gauge reaction to the budget, but it would have done so imperfectly as the first half of the survey was conducted on the night of the budget itself. Nonetheless, it’s a discouraging indicator for the government despite the small sample, comparing with a phone poll last week that had the result at 50-50 from primary votes of 39.5 per cent for Labor, 44.5 per cent for the Coalition and 9 per cent for the Greens. Morgan claims its face-to-face polling is “more reliable”, but history suggests otherwise.

UPDATE: I hadn’t noticed that Morgan had issued three separate releases providing further results from the phone poll. Figures on preferred party leaders show Kevin Rudd slumping nine points as preferred Labor leader since January to 34 per cent, now only eight points ahead of Julia Gillard, who is up one to 26 per cent. Wayne Swan, Lindsay Tanner and Stephen Smith have all gained three or four points, but remain in single digits. However, the big surprise is that Tony Abbott has lost his lead as preferred Liberal leader to Malcolm Turnbull, who for some reason has shot up 13 points since January to 29 per cent. Abbott is now equal with Joe Hockey on 27 per cent, the two having dropped three and one points respectively. Kevin Rudd maintains a 49-37 lead as preferred prime minister, despite recent reports of internal polling showing Abbott ahead in key marginal seats. For some exasperating reason, Morgan has made a separate release out of figures on leadership approval ratings, which have Kevin Rudd slumping to 36 per cent approve and 55 per cent disapprove. Figures for Tony Abbott suggest a lot of voters have made their minds up about him for one reason or another since last week’s phone poll: his approval rating is up 3.5 per cent to 44 per cent, but his disapproval is up 4.5 per cent to 46 per cent.

Finally, and worryingly for the government, a third release shows support for the mining super profits tax has gone sharply backwards since last week’s phone poll, with opposition up seven points to 52 per cent and approval down six to 41 per cent. Further questions on the government’s response to the Henry tax review also paint a less positive picture for the government than last week’s poll. The budget is found to have had an unremarkable response, 60 per cent deeming it average against 19 per cent good and 10 per cent bad.

UPDATE 2: Poll interpreter extraordinaire Aristotle writes in comments:

A couple to things to note: Even with the disastrous 36.6% primary vote, the ALP is still at about 50/50 TPP. In 1995 the L-NP led the ALP consistently all year by as much as 56/44 and in 2007 it was by even a bigger margin to the ALP by 60/40 at times. In 1998, 2001 and 2004 the ALP had leads of 56/44 and Howard’s approvals were worse then Rudd’s are now and Beazley and Latham had better preferred PM ratings than Abbott. Beazley led Howard and Latham was within a few points. There’s little doubt that the ALP is under the pump, but it’s a reaction to Rudd and the ALP it’s not an endorsement of Abbott and the L-NP. You’d really need to see big, consistent leads before you could believe there was going to be a change of govt. What’s going on now is the public are giving Rudd a kick, but until the L-NP starts to get quite big leads, there’s nothing to show they want to kick Rudd out. 36.6% is pretty bad, but still 49.7% TPP is not so bad. I think what’s casuing the most confusion is that Rudd and the ALP had such high figures for so long. Now they’ve come back to the pack.

Elsewhere:

• Labor national secretary Karl Bitar writes on Twitter that Steven Lewis, lawyer and Jewish Board of Deputies member, has been preselected as the party’s candidate for Wentworth. Imre Salusinszky of The Australian wrote last week that Lewis had lost the support of NSW Treasurer and party power-broker Eric Roozendaal after barrister Robin Margo entered the fray, but Margo got cold feet after Malcolm Turnbull rescinded his decision to retire.

• “ALP takes action on woman”, reads one of the less elegant newspaper headlines of recent memory. The story relates to the Labor preselection dispute for the new Queensland seat of Wright, where Left-backed CFMEU official Andrew Ramsay has successfully challenged his defeat at the hands of Right-backed media consultant Sharon Murakami. Ramsay won the union and party delegate vote 26 to 24 and the local party vote 38 to 25, but Murakami ended up in front after the affirmative action weighting was applied. His subsequent appeal over an unspecified procedural issue was upheld this week by the state party’s administrative committee.

• Consumer advocate Craig Kelly has won Liberal preselection to succeed retiring Danna Vale as candidate for Hughes. Lanai Vasek of The Australian reports Kelly won a local branch vote ahead of Peter Colacino, a 28-year-old infrastructure policy expert who had the public backing of Vale, and Sutherland Shire councillor Kent Johns.

• The Milton Ulladulla Times reports on extreme displeasure in local party branches over the Labor national executive’s installation of David Boyle as candidate for Gilmore.

Malcolm Farr and Simon Benson of the Daily Telegraph report Labor polling has shown the party has suffered a collapse in support in Lindsay, Page and Eden-Monaro. Liberal marginal seat polling is said to have shown Julia Gillard has a net approval rating of plus 16 while Kevin Rudd has fallen to minus 11, compared with plus 30 about a year ago. However, Kevin Rudd was said to be travelling better in Dobell.

• Melissa Fyfe of The Age reports Tom McFeely, owner of prominent Collingwood gay pub The Peel, is likely to emerge as the Liberals’ candidate for a winnable second position on the state upper house ticket for Northern Metropolitan. Fyfe further reports that Stephen Jolly, a prominent Socialist Alliance councillor for Yarra, will run as an independent in Richmond, where the Greens are a threat to Labor member Richard Wynne.