By chief political correspondent Emma Griffiths and Sabra Lane 

Updated February 03, 2012 17:15:17

Video: Leadership speculation dogs Labor (The Midday Report)

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The Prime Minister, the man she ousted from the job, and senior Labor ministers have publicly laughed off or dismissed suggestions of a leadership coup, but there is no escaping speculation that Julia Gillard's prospects in the job are terminal.

The renewed focus on the Labor leadership comes after an abysmal start to the year for the Government.

It began with ditching the pokies deal, continued with the involvement of a prime ministerial staffer in the angry protest on Australia Day, and has been topped off with continuing dismal polling.

There is growing despondency among Labor MPs, with some concluding that Ms Gillard's leadership is in "deep trouble" and suggesting there could be a leadership challenge before the Queensland election on March 24.

Ms Gillard's backers insist there is no appetite in caucus to return to Kevin Rudd.

One MP told the ABC that "the adults in the party are urging Mr Rudd's supporters to shut up and get on with their jobs".

Those who want Mr Rudd back in the job are keenly suggesting his return to the Lodge is on the cards; it is just a question of when.

Another has put forward the option of Ms Gillard bringing on the challenge to "lance the boil".

'Year of Kevin Rudd'

Last night Mr Rudd attended a dinner in Sydney to celebrate Chinese New Year and took questions from the floor.

The Foreign Minister laughed when he realised a journalist was in the crowd.

"I know where this is going to go," he said to the amusement of the audience.

"Who invited him?"

The journalist asked if 2012 would not only be the Year of the Dragon, but also the Year of Kevin Rudd.

Mr Rudd would only smile before giving a version of his stock-standard answer to leadership questions.

"I am delighted to be the Foreign Minister of this country and I am delighted to be out there working on Australia's behalf, and I'm delighted to take the excellent brand of this nation Australia to the world wherever I can," he said.

Employment Minister Bill Shorten, who was instrumental in ousting Mr Rudd from The Lodge, triggered laughter on morning radio by giving a series of monosyllabic answers to questions about another leadership change.

"Is it time for the Prime Minister to call a vote?" asked 3AW host Neil Mitchell.

"No," Mr Shorten answered.

It went on.

"Is Kevin Rudd a prima donna?"

"He's fine."

"Has Kevin Rudd accepted that he'll never be prime minister again?"

"I believe so."

"Will the Prime Minister lead to the next election?"

"Yes."

"Will she win the next election?"

"Yes."

"Was Simon Crean unwise to kick Kevin Rudd on the program this week?"

"No."

"Was he right?"

"He didn't kick him."

"To criticise him?"

"Ex-leaders, I think, have more flexibility to range around topics. I'm a brand new cabinet minister. I'm not going to fuel any of the leadership speculation."

Sober assessment

Defence Minister Stephen Smith gave a more sober assessment of the leadership situation.

"I'm a strong supporter of the Prime Minister and I'm confident the Prime Minister will lead us to the next election in the third or the fourth quarter of 2013 and I'm absolutely confident we will be very competitive in that respect," he told Sky News.

The Prime Minister has been asked the question most days in the past week and has once again dismissed it.

"I don't worry about chatter in the media. I get on with the job and I think we've got to be very focused," she told commercial radio in Canberra.

Labor MPs will gather for the first time this year on Sunday at the Lodge for what is being described as a brainstorming planning session ahead of the resumption of Parliament on Tuesday.

Ms Gillard says the meeting will not be focused on opinion polls.

She has told Capital Radio speculation about her leadership is "media chatter" and there are more important issues for the Government.

"I'm not in the camp that says you sit here with your eyes on the opinion polls and that's all that matter to you," she said.

"I'm here to make the changes we need to ensure our nation is stronger for the future."

First posted February 03, 2012 12:51:39

Increasing speculation over PM's future - ABC News (Australian Broadcasting Corporation)