Liberals and Nationals to pick new leaders on Monday

Former federal government MPs are making their way to Canberra to take their place on the opposition benches.

The Liberals and Nationals will pick their new leaders on Monday, as Scott Morrison hands over the reins, and Barnaby Joyce prepares for a party room showdown.

The one contender to take over as Liberal leader is former defence minister, Peter Dutton.

MP Stuart Robert said the Queensland MP was "very capable of leading us forward".

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The Nationals are heading for a leadership showdown, with Deputy leader David Littleproud telling Barnaby Joyce he wants his job.

The Nationals meanwhile, are heading for a leadership showdown, with deputy leader David Littleproud telling Joyce he wants his job.

Victorian MP Darren Chester is also throwing his hat in the ring.

The new government says it's getting on with the job of inspecting the nation's balance sheets, having inherited $1 trillion of debt.

Finance Minister Katy Gallagher is foreshadowing spending cuts but says Labor's budget will still have a "cost of living" lens applied, as prices surge.

"We need an honest conversation about this," she said.

"We can't pretend they're not coming, and we can't pretend the budget is in good shape and able to absorb this."

Meanwhile, Samoa has inked an economic agreement with China, after the Solomon Islands recently signed a security pact with Beijing.

Experts warn the Samoan agreement will give the Chinese government even greater leverage in the region.

"It says it wants to play a big security role, and now it's treating the South Pacific nations like a pack of cards, and it's collecting as many of them as fast as it can," Australian Strategic Policy Institute defence, strategy and national security director Michael Shoebridge said.

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