Brown quits as Labour leader

By Alex Stevenson

Gordon Brown will not continue as Labour leader, he has told journalists in a dramatic statement in Downing Street.

The development emerged as Nick Clegg opens negotiations with the Labour.

Mr Brown said in a statement outside No 10 he would remain in Downing Street until a government had been formed but that he had “no desire” to continue after steps to secure the economic recovery had been assured.

Gordon Brown’s resignation statement

“The reason we have a hung parliament is no single party and no single leader was able to command a majority,” he said.

“As leader of my party I must accept that is a judgement on me.”

Mr Brown, who became Labour leader in 2007, said he would stand down by September in time for a new leader to be in place by the party’s autumn conference.

Video: Gordon Brown quits

He explained: “If it becomes clear that the national interest which is stable and principled government… can be best served by forming a coalition between the Labour party and the Liberal Democrats, I believe I should discharge that duty to form that government which would in my view command a majority in the House of Commons in the Queen’s Speech and any other confidence votes.”

It comes as he revealed Lib Dem leader Mr Clegg had asked for formal negotiations to be opened with Labour.

“I believe on Thursday the country was also telling us they want a new politics and the political reforms we seek will help deliver that change,” he said.

Gordon Brown: A political obituary

“I now intend to facilitate the discussions that the Liberal Democrats will ask for.”

Mr Clegg then delivered his trongest hint yet that he would enter into a coalition with Labour.

“Gordon Brown has taken a difficult personal decision in the national interest,” he said.

Comment: Brown’s dignified exit

“And I think without prejudice to the talks that will now happen between Labour and the Liberal Democrats, Gordon Brown’s decision is an important element which could help ensure a smooth transition to the stable government that everyone deserves.”

The Cabinet will meet soon to discuss Mr Clegg’s advances. Mr Brown said it was “sensible and in the national interest to respond positively” to Lib Dem overtures.

Bookies install David Miliband as front-runner

Discussing the proposed tie-up between the Labour party and the Lib Dems, he added: “There is… a progressive majority in Britain and I believe it could be in the interests of the whole country to form a progressive coalition government.

“Only such a progressive government could meet the demands for political and electoral change which the British people made last Thursday.

“Our commitments for a new voting system for the Commons and a new election for the House of Lords are clearly part of this.”

Mr Brown’s announcement, scheduled at the last minute, means the Labour party faces a leadership contest with no obvious favourites.

David Miliband is one obvious contender, given his refusal to go the distance and make a formal challenge during the last two summers. Bookmakers are expected to make him favourite, as things stand.

His brother Ed is also expected to stand. Well-respected for his intellect by those who work closely with him, Ed Miliband has a far lower public profile than his brother and his politics are marginally to the left.

Alan Johnson and Ed Balls, Mr Brown’s favoured successor, are also expected to stand.

Jon Cruddas, the Labour backbencher who holds massive sway over the left of the party, may also run. Other reports suggest he could unite the left and the Blairite wings of the party via a ‘dream ticket’ with David Miliband.