Former minister seen as a `unifying figure' for Victorian Labor

Former health minister Daniel Andrews is poised to become Victoria's new opposition leader on Friday, possibly without a ballot.

Former health minister Daniel Andrews is poised to become Victoria's new opposition leader on Friday, possibly without a ballot.

As Labor's factions "unified" following the shock state election loss, the transition to a new leader gathered speed after John Brumby announced yesterday his decision to step down .

He did not make clear whether he would also quit state parliament.

Mr Brumby said it had been an honour to serve the party but the time had come for a new Labor leader.

"With such a narrow margin separating both sides of politics, the task of the new Labor leader is to hold the Liberal and Nationals parties to account and ensure that Labor is ready to govern again," he said.

Julia Gillard, Mr Brumby's former chief of staff, paid tribute to her old boss, saying he had made an "enormous contribution to Victoria both as a minister and as premier".

Mr Andrews's potential rival, former finance and water minister Tim Holding, has not put his hand up for the job and is considered likely to replace John Lenders as opposition Treasury spokesman.

"There is very broad support for Daniel," said one senior Labor source. "He is held in high regard in caucus, and combined with his youth, as he is not yet 40, he will be a good leader."

The source said Mr Andrews was also considered a "unifying figure" in the party and had experience in opposition as ALP assistant secretary when Steve Bracks lead Labor in 1999.

It is understood MPs approached Mr Andrews to take the top job and he has confirmed his interest in the role.

Renewal of the party has also begun behind the scenes, with state secretary Nick Reece stepping down early next year as planned before the shock election result. He will be replaced by one of his three deputies, Noah Carroll.

Deputy state secretaries Kosmos Samaras and Nathan Lambert are expected to keep their jobs, despite Labor losing power after 11 years.

Mr Brumby's deputy, Rob Hulls, looks likely to remain in his position but he is yet to make his intentions known publicly. Former regional development minister Jacinta Allan had been touted for the leadership but it is now understood she could be in contention for the deputy's job.

The factional balance of the party has also shifted in the wake of Labor's loss, with the broad Left -- which includes the socialist Left and the so-called "Ferguson" Left led by federal powerbroker Martin Ferguson -- retaining 27 MPs, including two independents.

The Labor Unity Right faction, led by federal powerbrokers Bill Shorten and Stephen Conroy, is claiming up to 18 MPs. And the "Taliban" or Rebel Right faction, led by federal powerbroker Dave Feeney and comprising a number of unions, has proportionally been hit hardest, now having as few as 14 MPs in the state parliament.