The Liberal party’s primary vote has collapsed in Bennelong where the Turnbull government is fighting a crucial by-election.

John Alexander, who was forced to resign as the Sydney seat’s MP because he was a dual citizen, has lost his nine per cent plus margin and is now neck and neck with Labor’s Kristina Keneally.

According to the Newspoll published in The Australian on Tuesday, they are 50-50 on the two-party preferred vote and 39-39 on the primary vote.

The Liberal’s vote appears to have gone to defector Cory Bernardi’s new party, Australian Conservatives which is running for the first time in the seat and has attracted nine per cent of the primary vote.

If Ms Keneally, a former Labor NSW premier, does pull off an upset this Saturday, it would rob the Turnbull government of its majority.

“Obviously we’d be down to 75 votes-all in the House of Representatives. It would be very precarious,” Prime Minister Malcolm Turnbull told News Corp journalist Miranda Devine on her web-based show on Monday.

Both parties are aware of how important this Saturday’s by-election is, with both Mr Turnbull and Opposition Leader Bill Shorten making frequent campaign appearances.

The Liberals have traditionally held the inner-north western suburbs of Sydney which has a large Chinese and Korean population.

Ms Keneally has accused Mr Turnbull of alarming rhetoric amounting to “China-phobia” and “scaremongering”, as both sides zero in on Chinese voters.

Mr Turnbull has strongly rejected the claim.