The contest underway for one of the Liberal Party's most glittering prizes – the safe seat of Mackellar held by former speaker Bronwyn Bishop – has been described as appalling and wrong by a high profile Liberal member.

Key points: Bronwyn Bishop and Jason Falinski fighting for Mackellar preselection

Bronwyn Bishop and Jason Falinski fighting for Mackellar preselection 7.30 investigation reveals widespread dismay at the process

7.30 investigation reveals widespread dismay at the process Liberal member David Flint says "Menzies would be horrified" by lack of democracy

Liberal member David Flint says "Menzies would be horrified" by lack of democracy Entrepreneur Dick Smith also among critics

Just 96 people will get a say on who the Liberals will select for the seat, and only two of the six nominees are in with a chance: Mrs Bishop and Liberal staffer Jason Falinski, who is backed by the dominant state faction.

An investigation by 7.30 has unearthed widespread dismay at the process in New South Wales that has seen at least one well credentialed candidate withdraw from the race.

Among the critics is Professor David Flint, a member of the Rose Bay Liberal Branch in Malcolm Turnbull's electorate of Wentworth as well as a monarchist and legal academic.

"Menzies would be horrified if he knew that potential members of Parliament were not being chosen on merit, but were being chosen because of their allegiance to a factional powerbroker," he told 7.30.

"That is appalling and it should not continue."

7.30 has obtained a list of pre-selectors from the last contest in 2013. It shows just 46 local members from 14 branches out of a total of about 400 Liberal members will get a vote.

Another 48 votes will come from head office.

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Professor Flint said both major parties should be forced to make their processes to pick candidates more democratic as they receive a large amount of funding from the taxpayer.

"They've awarded themselves a certain amount of money per vote," he said.

"Now, in return for that, they should be obliged by law, even perhaps by the constitution, but certainly by law, to be open, transparent and democratic.

"Why should we have a situation where we have political parties behaving as though they're political parties in a banana republic? That is absolutely wrong."

Entrepreneur and local identity Dick Smith is also appalled at the process.

"I think the whole way of selecting the candidate in, when it comes to the Liberal Party in Mackellar, is just completely wrong," he told 7.30.

"In fact, someone said it was corrupt and I believe it verges on that, because what should happen is the people who are members of the party should vote.

Mr Smith has threatened to run against his old friend Mrs Bishop if she is successful in winning pre-selection.

"My message to pre-selectors is, look, it's a secret ballot, why don't you rat on your faction and become a real Australian," Mr Smith said.

"I mean our forefathers went overseas to defend freedoms that we have.

"And don't be manipulated by the factions. When you actually get in for the secret vote, vote for who you actually think is going to be best for Mackellar - wow, won't that be a risky thing to do."

'Contrary to the principles of a democracy'

Mrs Bishop's branches are likened internally to North Korea.

7.30 understands she could get about 70 per cent support in the branches while Mr Falinski could get as much as 70 per cent of the votes from head office.

That makes it difficult for any other candidate to win.

Professor Flint fears contests like this are stopping the best candidates from running.

"They're not putting their hands up to run for the simple fact that they know that the determination has been made in advance," he said

"They know that the pre-selectors are committed, or many of the pre-selectors are committed, to a certain way, they act on directions.

"Now this is completely wrong and undemocratic and contrary to the principles of a democracy."

Another candidate, former campaign director Walter Villatora, has been part of a push in the party to democratise pre-selection contests.

He has letters of support from former prime minister Tony Abbott, New South Wales Premier Mike Baird and Mr Smith.

"I'm not in a political party, but when I looked into the Liberal Party, because I was a bit interested, I found that it was completely undemocratic," Mr Smith said.

"The fact that some of the people have been speaking out and then banned from the party is just outrageous. It's the opposite to what Bob Menzies would be wanting."

Pre-selection contests involving 22 Liberal MPs are currently underway in New South Wales.

Members will only get a vote in one seat, Parramatta, where a trial plebiscite is being held.

David Flint says the Mackellar pre-selection process is "contrary to the principles of a democracy".

"This is the party of Sir Robert Gordon Menzies. The party that was established for the 'forgotten people'," Professor Flint said.

"But nowadays the members of the party are left to do the hack work, to go out and distribute pamphlets and raise money but they are not allowed near the most important thing which is the pre-selection of candidates."

Liberal candidates are prevented from speaking to the media while pre-selection contests are underway.

Mrs Bishop hung up the phone when approached by 7:30.

You can see the full story tonight on 7:30.