Former NSW Liberal minister Stuart Ayres could be on track to return to cabinet after an inquiry cleared him of any legal wrongdoing in the appointment of John Barilaro to a coveted job in New York City.
The former deputy Liberal leader's role in the controversial appointment was scrutinised after a broader inquiry into the appointment of the former deputy premier found Mr Ayres may have breached the ministerial code of conduct.
That review by former NSW public service commissioner Graeme Head, released last month, found Mr Barilaro's appointment was not conducted at arm's length.
Mr Ayres maintained he had not engaged in wrongdoing, however, the review led to the former investment, trade, enterprise, tourism and sport minister resigning from cabinet and relinquishing his deputy Liberal leadership position.
Premier Dominic Perrottet ordered the independent legal review be undertaken last month, to establish if the member for Penrith had breached the ministerial code.
The review, carried out by former ICAC inspector Bruce McClintock SC, and released on Monday found Mr Ayres had not.
"While Mr Barilaro's appointment was controversial, my task is a limited one, that is, to consider and determine whether ... Mr Ayres complied with the Ministerial Code of Conduct," he said.
"My legal opinion is that Mr Ayres complied with his obligation under the Ministerial Code of Conduct."
Mr Ayres issued a statement saying the report made clear "I acted lawfully, honestly and had no conflict of interest".
He said the premier described the outcome to him as "an emphatic exoneration".
However, Opposition Leader in the Upper House Penny Sharpe says the outcome doesn't pass the pub test because the review had such a narrow framework that limited scrutiny of Mr Ayres' actions to whether he breached the ministerial code.
"He may not have technically breached the ministerial code of conduct, but he's shown very poor judgment, and the premier has allowed him to do that all the way along," she told reporters on Monday.
Mr McClintock wrote that Mr Ayres had not asked staff to break the law, and acted in a way he believed was in the public interest.
The appointment of Mr Barilaro to the US trade envoy position with an annual salary of $500,000 earlier this year has plagued the government for months.
Mr Barilaro relinquished the position in June amid allegations of "jobs for the boys", conceding his appointment was untenable and a distraction.
Mr McClintock accepted Mr Head's finding that the process was not at arm's length but that did not establish any beach of the ministerial code of conduct.
The men had been cabinet colleagues for years "but there does not appear to have been any other relationship or connection between the two men," he said.
"They were certainly not friends."
The earlier review into Mr Barilaro's hiring raised concerns about whether the process took account of the Code of Ethics and Conduct that's applicable to all NSW government staff.
It also found conflict-of-interest obligations were not managed when Enterprise Investment and Trade department secretary Amy Brown received an application from her deputy secretary, Jenny West and noted it was not typical to consult a minister on the make-up of a short list of candidates.
Ms West had knowledge about other candidates through her day-to-day duties.
Mr Head's review concluded that the person "ultimately responsible" for the appointment of Mr Barilaro was Ms Brown, noting that it "gave rise to considerable public controversy" and led to a parliamentary inquiry.
