Senate powerbroker says he will resign from the federal upper house to run in the South Australian election next March

Nick Xenophon will resign from the federal Senate to run for the South Australian state parliament.

The Senate powerbroker said on Friday he had been thinking about moving to state politics since the South Australian power blackout last year but his plans were delayed by his referral to the high court over section 44 concerns.

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Xenophon said he still believed he would win that case, which will be heard next week, but the time was right to announce his move to the state seat of Hartley, as South Australia gears for a March 2018 election.

Xenophon’s decision to cross back to state politics will significantly boost his micro-party’s fortunes in the looming state poll and could leave the man who began his career as a political independent on a no-pokies platform with a prospect of becoming premier.

Political sources in Canberra say the Xenophon group is polling very strongly in his home state, with a primary vote in the high 20s.

After dropping his bombshell on Friday, Xenophon said both the Liberal and Labor parties in South Australia “disappoint me to the brink of despair”.

“We have a government that deserves to lose and an opposition that does not deserve to win,” he said. “I’ve decided that you can’t fix South Australia’s problems in Canberra without first fixing our broken political system back home. Our state politics is broken, politically bankrupt.

“We have the same old soap opera script between Labor and Liberal but little real policy debate, let alone solutions for the state’s many troubles.

“South Australian politics has been reduced to a triumph of low expectations – where just keeping the lights on over the next summer will be presented by the government as a major achievement to be lauded and applauded.

“It’s embarrassing.”

Xenophon’s departure from the federal scene is a major shift for the micro-party and it is unclear who will replace him as leader.

The party is likely to wait to determine its future federal leader until Xenophon’s replacement in the Senate, likely to be Tim Storer, who was No 4 on the NXT ticket at the last federal election, is installed in the federal parliament.

Current indications suggest that may not happen until late November, because the state parliament would need to approve his appointment.

Xenophon said he would continue to remain “heavily involved” in the party’s operations in the federal sphere.

“We are in this limbo land because the high court needs to determine [depending on the outcome] whether it is a casual vacancy or a countback but either way it will be a NXT person that gets that seats, so there will be continuity and there will be the strengthening of the team.”

In a slightly cryptic statement, the NXT senator Skye Kakoschke-Moore said she had only been elected for a three-year term in last year’s double dissolution and was intent on running her own race.

Facebook statement

“Because of the double dissolution, I was elected for a three-year term whereas Nick and Stirling [Griff] were elected for six,” she said in a statement posted on Facebook.

“Along with working with the team on many issues, with just a three-year term I’ve always believed I needed to run my own race and secure my own achievements for the people of my home state and Australia.

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“Nick is the longest-serving crossbench member and I have worked for him and with him for more than seven years now so he will be missed in the Senate. But I will keep working hard for the people who elected us as a team and focusing my energy in the areas which are important to me including protection of children, gender equality and helping our most vulnerable.”

Xenophon told reporters that if the Xenophon group secured balance of power in the SA state election, he would not seek a cabinet seat if offered one by the state government. “If you are in the tent, you can’t be a watchdog.”

The ABC’s election analyst, Antony Green, told Guardian Australia that Xenophon’s shift made the state election a three-party contest.

“Anyone who wants to talk about two-party preferred in South Australia should just go and bang their head against a wall,” Green said Friday. “The South Australian election will be a three-party contest – it will be a duel between three people rather than two and the rules are not defined.

“He will win seats, he will probably guarantee that neither major party can get a majority in their own right. It comes down to which of those three … will end up with more seats than any other.”