Australian Prime Minister Kevin Rudd has called for a Labor caucus vote on his leadership and faces a challenge from deputy leader Julia Gillard. If successful, she will be the country's first woman prime minister.

The spill, as Australians call a leadership challenge, comes after a precipitous fall in Mr Rudd’s popularity since the beginning of the year.

The Australian Liberal party has a new leader with Tony Abbott ousting Malcolm Turnball in a ballot this morning by one vote.

Mr Abbott won the final ballot 42-41 to take control of the Australian opposition party.

Treasury spokesman Joe Hockey also had a crack at the leadership but was eliminated in the first round of voting.

Party arguments over support of the Australian Emissions Trading Scheme sparked the shock result with Mr Abbott vowing the Liberal Party would try to force the legislation back to the committee stage.

The Australian government has set a modest target of reducing its greenhouse gas emissions by 5-15% below year 2000 levels by 2020.

It also set an emissions trading price cap of $A40 per carbon unit, rising by 5% annually, for the 2010-2015 period.

This comes as New Zealand’s National government has delayed introducing an emissions trading scheme while it does a wide-ranging review on climate change policy.

Businesses and individuals involved in trans-Tasman civil legal cases are set to benefit from reforms that will make the process easier and more affordable, the New Zealand and Australian governments said today.

Associate Justice Minister Lianne Dalziel and Australian Attorney-General Robert McClelland will sign the Treaty on Trans-Tasman Court Proceedings and Regulatory Enforcement in Christchurch tomorrow.

"This treaty represents an unprecedented level of co-operation between Australia and New Zealand in civil court proceedings," they said in a joint statement.