The Deputy Prime Minister claimed he has renounced his New Zealand citizenship and it has been acknowledged by the New Zealand government.
The Prime Minister was asked directly in Question Time on Tuesday whether Barnaby Joyce is a dual New Zealand citizen. The government attempted to block the question before Mr Joyce himself was allowed to answer it.
"Over the course of the weekend, we went through the process of renunciation," he told the chamber.
"We received verbal communication from New Zealand before Question Time that that has now been accepted and we're looking forward to the written advice turning up pronto."
Earlier
New Zealand's Labour leader has accused Julie Bishop of making "false claims" about the party after the Foreign Minister alleged the Australian Labor Party was using NZ Labour to undermine confidence in the government.
In an extraordinary development on Tuesday, Ms Bishop accused Labor leader Bill Shorten of “using a foreign political party to raise serious allegations” about Deputy Prime Minister Barnaby Joyce’s citizenship, designed to “undermine confidence in the Australian government”.
The claim relates to NZ Labour MP Chris Hipkins, who in a parliamentary question last week, asked the NZ internal affairs minister whether a child born in Australia to a Kiwi father would automatically have citizenship. He's yet to receive an answer.
NZ Labour leader Jacinda Ardern said an Australian Labor MP had put questions to him.
"He's been very clear: Yes, someone from the ALP put some legal question to him around citizenship, no mention was made of anyone's name, no rationale for any particular case being pursued was ever raised," she told radio NZ.
'Highly unethical'
Ms Bishop jumped on that revelation, accusing Mr Shorten of "highly unethical" conduct, adding it put the relationship of the Australian and New Zealand governments at risk.
“New Zealand is facing an election. Should there be a change of government, I would find it very hard to build trust with those involved in allegations designed to undermine the government of Australia.”
Ms Ardern said Ms Bishop's comments were "highly regrettable", labelling them "false claims".
"I greatly value New Zealand's relationship with the Australian government. I will not let false claims stand in the way of that relationship," she said in a statement.
Ms Ardern said she has contacted the Australian High Commission to register her disappointment and would be meeting with the Australian envoy on Tuesday.
The government’s woes have been exacerbated by the revelation that Mr Joyce holds dual citizenship from his New Zealand-born father.
Dual citizens cannot be elected to parliament under the Constitution.
Cabinet minister Christopher Pyne accused Labor of forming a plot to bring the government down.
“The Labor party is involved in a conspiracy using a foreign government in this case, New Zealand to try and bring down the Australian government,” he told Sky News.
“Labor never stoop too low.”
However, New Zealand's internal affairs minister Peter Dunne said questions from journalists, not an MP, were the trigger for the citizen check on Barnaby Joyce.
"This is so much utter nonsense - while Hipkins' questions were inappropriate, they were not the instigator. Australian media inquiries were," Mr Dunne tweeted on Tuesday.
Government loses Katter on supply, confidence
Meanwhile, Queensland MP Bob Katter says he is no longer guaranteeing confidence and supply in the government.
“Absolutely, it’s back to the drawing board,” he told Sky News.
Mr Katter, along with fellow independents Cathy McGowan and Andrew Wilkie all indicated they would guarantee supply and confidence to the Turnbull government after the 2016 federal election.
The development does not yet endanger the government, but could potentially if it loses its one-seat majority.
Confidence and supply - voting for the Government’s budget legislation - are crucial in a minority government.
By convention if the government lost a no-confidence motion in the House of Representatives, it usually requires the government to resign.
The loss of Mr Joyce's seat in parliament would leave the Turnbull government with 75 seats in the lower house, one short of a majority, meaning it would need the support of one of five crossbenchers to ensure supply and confidence.
Mr Katter indicated he would support any government that would back regional interests.
- With AAP
