Voters in Melbourne's north-east will head to the polls for the third time in just over a year, after Liberal MP Ryan Smith — a critic of leader John Pesutto — called time on his Victorian political career.
Mr Smith will resign on July 7 to take up a job in the corporate sector, forcing a by-election in Warrandyte.
It is the first electoral test for Mr Pesutto. A loss would be a disaster for his fledgling leadership, but Mr Smith's resignation could also ease some tensions in the divided party room.
Mr Smith informed the speaker that he would resign from parliament on July 7, saying he had been privileged to have served the role of MP.
"However, amongst other reasons, I have become increasingly uncomfortable with the growing negative tone of politics, both internally and more broadly,'' Mr Smith said in a statement.
The Opposition Leader said the party would throw everything at the by-election and acknowledged the party needed to improve diversity of its candidates.
"We need more women in the Victorian parliament,'' Mr Pesutto said.
Under parliament's rules, Mr Smith could claim up to six months' pay upon resignation, worth at least $96,000.
Mr Smith has represented Warrandyte since 2006 and was a minister in the Baillieu-Napthine government.
More recently he was a key supporter of now-expelled MP Moira Deeming as part of a faction opposed to Mr Pesutto's embattled leadership.
Mr Smith did not mention Mr Pesutto in his two-page statement.
"My son was one when I entered politics and my daughter was born into it," Mr Smith said.
"I am exceedingly proud of both of them and they have been, not only the lift I need when I get home, but a big reason why I work to try to make things better for our community."
Aston by-election result may determine whether Labor contests Warrandyte
MPs only learnt of Mr Smith's decision as they entered parliament on Wednesday morning — despite parliament still having a week to sit before he resigns, MPs do not expect Mr Smith to return to the house.
"Ryan, like anybody else who chooses the timing of their own departure, is completely to be respected for the way he wants to make his own announcement. These are very personal things,'' Mr Pesutto said.
Warrandyte was once a safe Liberal seat, but now the party only holds it by 4.2 per cent. Some party members are fearful of losing the seat in the wake of the disastrous result in the federal seat of Aston in April, where the seat previously held by Liberal Alan Tudge went to Labor.
Speaking on ABC Radio Melbourne Mornings, Liberal MP Nick McGowan said Mr Smith had done a "sensational job".
He said he was confident the party would hold Warrandyte.
"I think that's probably going to be a testament to the hard work that Ryan has done over the two decades he's been there,'' Mr McGowan said.
"Rest assured, we have the ingredients in our party room. We have a solid leader in John, and I have no doubt that we have what it takes to actually present a very credible opposition in four years' time."
Caroline Inge, the party's federal vice-president, has already been put suggested as a potential replacement.
While upper house deputy leader Matthew Bach ruled himself out of running for the seat, former Kew MP Tim Smith confirmed he was considering his options to run.
Mr Smith did not contest his seat at the 2022 election after he was forced to resign from his position as the state's shadow attorney-general after crashing his car while drink-driving.
It is also unclear whether the Labor Party will contest the by-election — often it has avoided by-elections in Liberal-held seats, but the Aston by-election has given some ALP supporters hope of another upset.
Although the political climate is much different, given it is the ninth year of the Andrews government and the by-election will be held months after a horror budget.
Premier Daniel Andrews said it was a matter for the ALP to decide if it would contest the by-election. Senior Labor sources say the party has not ruled out running.
It is up to the speaker to decide when the by-election will be held.
Moira Deeming launches fresh legal challenge
Meanwhile expelled Liberal MP Moira Deeming has issued a fresh legal challenge to under-pressure Mr Pesutto.
The rookie upper house MP had already taken legal action against the opposition leader with a defamation claim over his accusation earlier this year that she was linked to far-right activists and neo-Nazis, after she attended an anti-trans-rights rally in Melbourne.
Mr Pesutto will contest the defamation action.
This afternoon Ms Deeming confirmed she had issued a second, separate concerns notice against Mr Pesutto but she did not give any further details.
Mr Pesutto's office declined to comment.
