Taoiseach Enda Kenny forced his controversial Seanad candidate John McNulty to withdraw from the race as the Government struggled to contain the cronyism debacle.
Mr Kenny is also blaming Fine Gael party officials for having Mr McNulty appointed to the board of the Irish Museum of Modern Art (IMMA).
Arts Minister Heather Humphreys says she was asked by Fine Gael party officials to appoint John McNulty - but she didn't know he was the party's candidate for the Seanad.
Mr Kenny says he approved Mr McNulty as the party candidate for the Seanad, but didn't know he was then appointed to the state board.
After Mr McNulty asked TDs and senators not to vote for him, the Taoiseach told the Dail it was not worth winning a seat in the circumstances.
"My own standards were let slip and my own sense of integrity and trust did not measure up," he said.
Mr McNulty withdraw from the race after Mr Kenny despatched party officials at lunchtime to speak to him.
The Taoiseach told Tanaiste Joan Burton in the morning that Mr McNulty would be withdrawing from the contest.
My Nulty told Highland Radio yesterday that the sequence of events "has just taken its toll in a lot of ways".
He said he had asked to be appointed to a board after the local elections when he failed to get a seat on Donegal County Council.
"I would have worked on whatever board that I would have went on and I would have given it 100pc and then I had the option to go on the IMMA board and I was delighted."
And amid more controversy for the Government, Hilary Quinlan resigned as a director of Irish Water after it emerged that he had been appointed as a ministerial driver earlier this year.
Following the appointment of Fine Gael's Paudie Coffey as a junior minister in the Department of the Environment last July, he hired Mr Quinlan as his personal driver, on a salary of €665 a week.
Mr Quinlan lost his Fine Gael council seat in Waterford last May in the local elections. He had been appointed to the board of the semi-state body last November.
In the wake of the debacles, the Government has moved to clean up the appointment of officials to state boards by making the process independent.
Public Expenditure Minister Brendan Howlin said the new system will ensure that each state board position that becomes vacant will be advertised by the independent Public Appointments Service (PAS).
Individuals wishing to join a public body as a director will be placed on a panel and be assessed.
But Mr Howlin admitted that the decision appointments will lie with each line minister.
The minister confirmed that State board appointments will still be made by ministers.
"Under the statute, most state boards are established by law and it will fall to the minister obviously to make the determination from the panel of deemed, suitably independently deemed, suitably qualified persons," he said.