The John Barilaro case took the shine off NSW’s tough-guy premier Dominic Perrottet

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<p><figcaption class=Photography: Bianca de Marchi/AAP

New South Wales Prime Minister Dominic Perrottet looked stressed as he led the media on Wednesday to announce that his Liberal deputy leader and trade minister, Stuart Ayres, had agreed to step down from the cabinet.

The scandal over the appointment of former Nationals leader John Barilaro to a $500,000-a-year commercial job in New York (which he created before leaving parliament) festered for six weeks and took the shine off a prime minister. minister who has not yet completed 12 months in office.

The prime minister’s own trade mission to Asia was a disaster, overshadowed by daily questions about who knew what and when in the Barilaro affair.

Related: Stuart Ayres suggested John Barilaro ‘might be very good’ in New York role, NSW inquiry said

Perrottet had promised an orderly and proper government, carried out as he claimed to have directed the NSW Treasury. The stream of revelations about Barilaro’s work raises questions about whether the processes for filling key positions are in fact politicized.

Perrottet is probably too young to risk being rolled over on this topic, but his way of handling this ongoing crisis has colleagues questioning whether he has the right things under pressure.

Before this and other crises, notably floods and the pandemic, Perrottet was the tough man of NSW politics: the man who could deflect a political attack and hand it back to his opponents with devastating ease.

On Wednesday, he looked a little uncertain.

The crisis also revealed the power dynamics within the NSW government. Ayres, a senior moderate, was instrumental in Perrottet, a rightist, getting the top job, as was fellow moderate mediator, treasurer Matt Kean.

Liberal leaders in NSW over the past two decades have come from the dominant moderate faction, an acknowledgment of the factional power they wield in the state, to the perennial dismay of the conservative wing.

But Perrottet’s performance as Gladys Berejiklian’s loyal aide and treasurer meant he had a strong claim to the top job, despite coming from the minority faction.

It is now clear that it came with strings attached.

When it came time to fall on his sword, the ambitious Ayres, who occupies one of the most marginal seats in the Penrith government, was initially able to resist doing the obviously right political thing and withdrawing until the outcome of an internal investigation.

Instead, he struggled, at considerable cost to Perrottet and his government.

Ayres, who was trade minister at the time of Barilaro’s appointment, insists he did nothing wrong. But he acknowledged on Wednesday that a pending report by bureaucrat Graeme Head had raised a possible violation of the ministerial code of conduct and that he would resign to defend himself.

The vacancy will again lead to a push within the dominant moderate faction in NSW, with the new deputy on the podium to succeed Perrottet as prime minister.

Kean, the other critical figure in the rise of Perrottet, who lost his vice role last October, is the favorite to fill the role this time around.

Related: Stuart Ayres resigns as NSW minister after issues raised by John Barilaro review of trade paper

Most of his colleagues believe he can do it if he wants to, although strictly speaking it’s a ballroom decision next Tuesday.

Kean has had a strong performance as treasurer but is considered controversial and outspoken, particularly on climate change policy issues, where he strongly criticized his federal colleagues.

NSW treasurer Matt Kean is widely expected to fill the role of Liberal deputy leader. Photography: Bianca de Marchi/AAP

On Tuesday, he became embroiled in a minor controversy on Twitter, when he retweeted a comment by journalist Nikki Gemmell highlighting the unequal treatment of fair trade minister Eleni Petinos, was immediately removed for an alleged wrongdoing, and Ayers, who was allowed to stay until morning.

Kean later claimed that someone had “thick thumbs” in his office and rejected the retweet.

He’s been playing a long game in politics, so the timing might not be right.

Other possibilities to replace Ayres are Attorney General Mark Speakman and Minister of Infrastructure and Cities Rob Stokes.

Stokes is said to still lack the numbers on the moderate faction (he received just five or six votes in last year’s leadership vote) and colleagues believe he remains disillusioned with the government’s direction.

Speakman would be a safe choice, but he doesn’t have the public profile of the other two ministers.

Emergencies Minister Natalie Ward was also mentioned, but she is in the upper house, which would make her filling for the prime minister difficult.

Transport Minister David Elliott has also expressed interest, but as a leading figure in the centre-right figure, he may struggle to gain support from moderates, who will be reluctant to step down.

Ayres may well be hoping for political redemption as a result of the internal inquiry, but the decision by his partner, Morrison’s former federal government foreign minister Marise Payne, to take a behind-the-scenes role in the opposition has raised questions about their long-term commitment to politics and the couple’s ongoing role as powerhouses in NSW.

Until this scandal, the duo could have been looking to government appointments as their next step. Now, the private sector looks more likely.

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