McKenzie's fate to be decided this weekend

The fate of Nationals deputy leader Bridget McKenzie will be decided this weekend, with Prime Minister Scott Morrison unwilling to allow the saga to drag into next week's resumption of federal Parliament, Coalition sources said.

Late on Friday, the 10 network revealed a email which showed Mr Morrison's office had some direct input into the allocation of a handful of the grants, despite blanket denials by the Prime Minister.

It is understood Senator McKenzie herself is aware that, by Monday, she may no longer be in cabinet given her role in the sports rorts affair in the lead-up to the 2019 election.

Despite the widespread rorting of $100 million in grants to target key seats, Senator McKenzie may be dismissed only on a technicality – that one grant of $36,000 was given to a gun club of which she was a member.

This would firewall anyone else, including the Prime Minister's office, from any possible sanction should they be found to be involved.

Her fate rests on a report to the Prime Minister by his departmental secretary Phil Gaetjens which was expected to be finalised by Friday.

Mr Morrison has denied either he or his office had anything to do with the scandal other than to pass on to Senator McKenzie's office requests from Liberal MPs for funding for projects in their electorates.

But an email obtained by Channel 10 showed an adviser to Senator McKenzie advising the minister had been "asked to make a slight adjustment'' which saw grants directed to the marginal Coalition seat of Hinkler, the safe Coalition seat of Gippsland, and the Tasmanian seat of Denison, held by independent Andrew Wilkie.

Labor says that is inconceivable given the highly orchestrated nature of the rorting.

There is fierce competition brewing within the Nationals for Senator McKenzie's various roles as a cabinet minister, Nationals deputy leader and Nationals Senate leader should she be ousted.

Such upheaval has the potential to destabilise Nationals leader Michael McCormack.