Josh Dunkley and Bailey Smith during the 2022 AFL Round 1 match between Melbourne and Western Bulldogs (Photo by Cameron Grimes / Zero Digital Media)

Suspended Western Bulldogs midfielder Bailey Smith is edging closer to a contract extension to remain in red, white and blue, despite his off-season indiscretions recently coming to light.

Smith is currently serving a two-match, AFL-imposed suspension after footage of the superstar midfielder possessing an illicit substance recently surfaced.

Off-field issues aside, the 21-year-old has been stellar for the Bulldogs this season, averaging an astounding 31.6 disposals, 4.3 marks, 6.7 inside 50s and 3.7 clearances per game in 2022, as well as ranking first in the AFL in uncontested possessions and third in metres gained.

Smith is set to come out of contract at the conclusion of this season, however, it seems as if the youngster's recent hiccups won't impact his contract discussions with the Bulldogs.

Speaking recently on 3AW's Sportsday, Dogs CEO Ameet Bains stated Smith's frowned-upon actions would not hold any sway over the two parties' ongoing negotiations.

"We don't think it should have too much impact in [contract negotiations]," Bains said.

"We had made a fair bit of progress with his manager, Paul Connors, in the last two to three weeks, so hopefully that momentum can keep going.

"The important part is ... the incident was from last year. While the club didn't have any knowledge of any vision being in existence until it came to our attention last weekend, that period that Bailey was dealing with late last year that led to the poor decision-making was something we knew about and dealt with at the time.

"To his credit, he's put a lot of things in place over the last six to eight months to deal with that, and his on-field performance has reflected that."

While the Bulldogs could theoretically use Smith's actions as leverage to negotiate cheaper contract terms, it looks increasingly likely the club will opt for a clean slate with their prized midfielder.

The Bulldogs will welcome Smith back with open arms when the club does battle with St Kilda in Round 18.