Sussan Ley faces no shortage of ideas about what the federal Liberal Party should do to be competitive again after suffering its worst-ever election defeat.

Some MPs have suggested a formal merger with the Nationals, similar to Queensland where the LNP governs, or setting up a new right-wing conservative party.

Others have discussed the possibility of a split between the moderate and conservative flanks - an idea quickly hosed down by Liberal leadership.

While the party's strategy remains unclear as the coalition continues to work through a wholesale policy review, the opposition leader wants MPs to reconnect with voters on longstanding Liberal values of lower taxes and smaller government.

On the 81st anniversary of the federal party's founding, Ms Ley said the future must be dictated

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