He said his resignation, effective 5pm on Thursday, would enable him to keep speaking out.

"I realised my constant outspokenness was incompatible with the position in the long term," he said.

He rejected speculation he was also planning to defect to Bob Katter's party or One Nation, a move that would leave Mr Turnbull with minority government. But he confirmed he would be voting for a Greens bill to establish a parliamentary commission of inquiry into the banks. The Greens are now just one vote short.

Like most of his colleagues from Queensland, Mr Christensen believed the merger in 2008 was a grave error but he thought it would be impractical to try to demerge.

David Rowe

"There is a growing view among MPs and others that there should not be a demerger but a debranding," he said. This would include, but not be limited to, resorting to the use of separate National and Liberal Party logos on electoral material and ballot papers.

Other suggestions include the entire LNP sitting in a separate party room in Canberra, as a third Coalition member.

One senior Queensland MP said there was considerable anger over what had happened a decade ago given so many warned at the time that the merger would be a disaster. He said a demerger should be considered in which the Liberals would be concentrated around Brisbane and the Nationals across the rest of the state.


Mr Christensen's decision to keep breaking ranks was announced just after Mr Turnbull told the party room the Coalition could win the next election but only if it was united.

He told MPs the Coalition had a duty to the Australian people and constituents to stick together. He said the election was two years away and "we'll win if we stick together".

There is little prospect of this. Late on Tuesday, conservative MPs vowed to keep agitating to water down section 18C of the Racial Discrimination Act after a parliamentary inquiry recommended lesser action.

The inquiry made a bipartisan recommendation that section 18C, which makes it an offence to insult or offend somebody based on race, be left unchanged, But it recommended a tightening of the process to make it harder for frivolous or vexatious complaints to be made and to provide legal resources to help those who find themselves subject to complaints.

Chair of the joint committee on human rights Ian Goodenough said government should direct resources to prevent serious incidents of racism rather than "cartoons and trivial matters".

But MPs who had been advocating to remove "insult" and "offend" and replace it with "harass", such as Tim Wilson, said the recommendations did not go far enough.

Core conservative Eric Abetz, an ally of Mr Abbott who wants the Human Rights Commission abolished, also said there must be more comprehensive change than that recommended by the committee.

"Unless urgent reform is progressed, we will continue to see outrageous claims brought forward like we've seen with the QUT case and the Bill Leak case," Senator Abetz said.

Labor said Mr Turnbull should show some "backbone" and go no further than the recommendations of the report.

"Mr Turnbull launched the inquiry into 18C to appease the hard right of his party, who want to protect people who spout racial hate speech. But today's report gives him no cover if he chooses to once again bend to the ideologues," said shadow citizenship minister Tony Burke.