Stuart Ayres resigns as NSW minister after questions raised by John Barilaro trade role review

Stuart Ayres has resigned as deputy NSW Liberal leader and trade and investment minister, with the premier, Dominic Perrottet, saying a draft of an independent report raised questions over his engagement with the department in the appointment of John Barilaro to a New York trade position.

Perrottet said Ayres offered his resignation late on Tuesday night after a draft excerpt of an independent report by Graeme Head raised questions deemed a possible breach of the ministerial code of conduct.

However, Ayres denies any wrongdoing and said he was only standing down to allow the matter to be further investigated.

“Based on information I received yesterday, there are questions … that relate to the engagement between the minister and a department secretary in respect of the recruitment process,” Perrottet said.

“On receiving that information, I have made the decision to act. In relation to the entire review, once that review is finalised I will make it public and I always have said I will.”

Perrottet said Ayres had denied any wrongdoing in relation to the appointment and stands by his position that the recruitment process was conducted at arm’s length.

“Mr Ayers denies any wrongdoing at all,” Perrottet said.

He said there would be a further investigation by the department of premier and cabinet into Ayres’ conduct.

In a statement released on Wednesday, Ayres said he did not believe he had breached the code but would stand down while it was investigated to maintain the integrity of the cabinet.

“Last night, I read a section of the independent review being conducted by Graeme Head. This section is relevant to my role as minister. It creates a question as to whether I breached the ministerial code of conduct,” he said.

“In my view, no such breach has occurred. However, I agree it is important that this matter is investigated appropriately and support the premier’s decision to do so.

“To maintain the integrity of the cabinet, I have decided to resign as a minister to allow the investigation to be completed,” he said.

Despite coming under increasing pressure, Ayres has maintained that Investment NSW head Amy Brown had the ultimate responsibility for the decision to appoint Barilaro to the role that he has since given up. Brown will give evidence at an NSW parliament upper house inquiry into the matter on Wednesday.

The Head investigation is separate to the upper house inquiry and was established by the premier.

Perrottet has repeatedly said he would not act on the matter until the Head review was completed but on Wednesday said the draft he had seen meant waiting to act was no longer viable.

“Mr Head’s review does not and could not extend to whether Mr Ayres had complied with the ministerial code of conduct. When I put these matters to Mr Ayres, he offered his resignation from the ministry and as deputy leader of the parliamentary Liberal party,” Perrottet said.

The report was still in its draft form, Perrottet stressed, and would not be released until it was completed. He said the parts he had seen so far, however, “clearly demonstrates the process was not at arm’s length”.

“But the questions that have arisen that come through the report make it very clear in my view and in Mr Ayers’s view that there are potential breaches of the ministerial code. And in those circumstances, this is the appropriate course of action to take.

“He has a different view in relation to his engagement with the process and the review that will be conducted by DPC will make findings.”

The premier defended his handling of the saga following the announcement in June that former deputy premier Barilaro had been appointed to a $500,000-a-year trade and investment role based in the US.

“I said from the outset in relation to these matters that I would conduct an inquiry, and that is exactly what I have done,” Perrottet said.

Ayres intends to remain in the parliament as the member for Penrith.

Barilaro has previously said he “always maintained that I followed the process”. He is scheduled to give evidence to the upper house inquiry next week.