Ministerial sources said they did not want to give the impression they were resurrecting the GLC, which once had the red flag flying over the building, when it was led by Ken Livingstone. "It would have sent out the wrong signals," said the source. "And anyway, it would have been too big."
The Government's plans for an elected assembly of about 30 members and an elected mayor will be set out in a Green Paper which is expected to be published tomorrow.
Mr Livingstone is among those who have expressed an interest in becoming London's first elected mayor. Others include Tony Banks, the minister for sport, Steve Norris, the former Tory transport minister, and David Mellor, the former heritage minister.
But Mr Livingstone has warned that the mayor could be open to corruption from organised crime, like some mayors in the United States. The Government believes the elected assembly is essential to provide checks on the mayor's power.
The Green Paper will announce that the new mayor will be elected through an alternative vote system, under which electors can list their choices in order. The losers' votes will be redistributed one by one until someone has won 50 per cent of the vote.
The mayor will be supported by a council of about 30 people, but the Government's paper will stop short of advocating their election through proportional representation. Instead it will set out a range of options including a first-past-the-post election in each European constituency in Greater London and a "list" system. Under the latter, about two-thirds of the council could be directly elected while others would be chosen from party lists which could include people with cross-London interests or be used to top up the number of women if necessary.
The new mayor will be responsible for transport, planning and economic development, the police and fire services and public health. He or she will also act as a "voice for the capital".
Margaret Hodge, Labour MP for Barking, helped to shape the plans through a Fabian paper last year. "It is very exciting that the Government is moving so fast on developing firm proposals. But I hope that we will grasp the opportunity to have a new system of voting."