Liam Byrne steps down from Shadow Cabinet in bid for elected mayor role

The Labour Shadow Cabinet minister responsible for drawing up the party's policies for the next election is to step down from Westminster politics in an attempt to become the first directly elected mayor of Birmingham.

Liam Byrne, former Chief Secretary to the Treasury, will become the highest profile politician yet to declare for the new role and cause a political headache for Ed Miliband.

The former Deputy Prime Minister Lord Heseltine and the Cities Minister Greg Clark travelled to Birmingham in an attempt to drum up support for a yes vote in the referendum this May which is also taking place in ten other cities, including Bristol, Leeds, Manchester and Newcastle.

A poll released yesterday suggested a majority of voters nationwide supported a change in the model local Government. But senior Government figures fear locally as few three cities may endorse the move which is being opposed by local councillors fearful that new roles will dilute their own power.

The departure of Mr Byrne, currently Labour’s Shadow Work and Pensions Secretary would surprise many Labour MPs and would disappoint fellow Blairites, some of whom are unhappy with the party’s direction under Ed Miliband.

As well as holding an important Shadow Cabinet brief, Mr Byrne is in charge of the wholesale review of Labour’s policies ordered by Mr Miliband – a process due to be concluded this autumn - and a post that would have allowed Mr Byrne to shape Labour’s manifesto at the next general election.

Under Labour rules he will be expected to stand down from Parliament if he wins the party’s nomination which wil be announced in June. He will face competition from fellow Birmingham MP Gisela Stuart former MP Sion Simon.

Although Mr Byrne is MP for Birmingham Hodge Hill, his decision to consider a career away from Westminster will raise questions about whether he is content with Labour’s progress under Mr Miliband.

An arch-moderniser, as a Labour official he was responsible for the party’s links with business while Tony Blair was leader. At the time, Labour enjoyed a close relationship but the party failed to win any business endorsements at the 2010 election and Mr Miliband has alienated some business leaders by attacking “predators” who exploit the system.

Mr Byrne, a former management consultant, was nicknamed Baldemort by officials when he was a minister. As a joke, he left a note to David Laws, his successor as Chief Treasury Secretary after the 2010 election, saying: “I'm afraid to tell you there’s no money left.”

Yesterday in an interview ahead of an event designed to encourage support for new Mayoral roles – which have been enthusiastically backed by David Cameron Mr Clark suggested that they would eventually have new powers.

He said he was open to handing over responsibility for transport, inward investment and possibly some tax raising powers – but on a city by city basis.

He also confirmed it would be possible for an elected mayor also to stand for new role of police commissioners – greatly increasingly their responsibility.

However as outside London the police commissioner roles follow police force boundaries rather than municipal ones this could prove to be controversial.