Barnaby Joyce has capitulated to intense pressure and announced he will stand down, declaring the government needs clear air and he could not continue on the frontbench with an allegation of sexual harassment hanging over him.

He told a news conference in Armidale he would quit as Nationals leader and deputy prime minister on Monday at an 8am party meeting, where a new leader will be chosen.

After hanging tough for more than a fortnight, Joyce said the final straw was the harassment allegation, by a Western Australian woman, that was made to the Nationals federal president Larry Anthony and revealed on Thursday.

He had asked that the allegation, which he denies, be referred to the police. “But it’s quite evident that you can’t go to the despatch box with issues like that surrounding you.”

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Malcolm Turnbull, who last week said Joyce “has to consider his own position” and will be relieved at his departure from the frontbench, quickly affirmed in a statement that the Coalition “partnership is undiminished”.

The crisis over Joyce, sparked by revelations in the Daily Telegraph of his affair of his former staffer and now pregnant partner Vikki Campion, has consumed and distracted the government, wiping out what promised to be a good start to the year.

The favourite to replace Joyce as leader is Michael McCormack, a junior minister from New South Wales. He is minister for veterans’ affairs and minister for defence personnel.

Joyce informed Acting Prime Minister Mathias Cormann and his Nationals colleagues before his announcement. He did not speak with Turnbull, who is in Washington. A week ago, Joyce denounced Turnbull’s very personal attack on him.

Today he said it was “incredibly important that there be a circuit-breaker, not just for the parliament but more importantly a circuit breaker for Vikki, for my unborn child, my daughters and for (wife) Nat”.

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He said that over the past half a month there had been a litany of allegations. “I don’t believe any of them have been sustained.”

He condemned “the leaking, the backgrounding … it will destroy not only our government. It will destroy any government.”

Joyce confirmed he would stay in the parliament, and said he wouldn’t snipe from the backbench. “I have a lot of things I need to do,” he said. He was writing a book, and he wanted to assist his colleagues where he could to keep their seats. And his baby would be born in April. So “I’ll have other things on my mind”.

Joyce’s exit to the backbench means another reshuffle, hard on the heels of the December changes. Meanwhile John McVeigh, a Queensland Liberal who is minister for regional development, will act in Joyce’s infrastructure portfolio.

Joyce has been leader of the Nationals and deputy prime minister since February 2016.

While Joyce’s stepping down will relieve pressure on the government, there will still be intense questioning next week in Senate estimates about the employment arrangements for Campion, who was transferred from Joyce’s office to that of Resources Minister Matt Canavan, and later to the office of then-Nationals whip Damian Drum.