The federal government's leadership group has been discussing the possibility of a double dissolution election for the past three weeks, sources say.

As the Prime Minister's office was quick to pour cold water on an early poll, it has emerged that the prospect was discussed in at least three meetings of the leadership group, a telephone hook-up, and at a dinner on Monday following a meeting of the ministry.

The next general election is not due until late 2016.

Agriculture minister Barnaby Joyce said it would be lunacy to bring on an early poll. Alex Ellinghausen

The double-dissolution plan centred on going to the polls later this year with the pitch that the Senate was making budget reform impossible. The trigger would have been a second rejection of the higher education deregulation legislation that was defeated Tuesday night.

The revelation has alarmed Coalition MPs who feel that would be wiped out in any election in coming months and that it would only serve to put more independents and micro-parties in the Senate.