Labour leader David Shearer has received unanimous support from Labour's caucus.

Shearer called for the vote after his leadership was effectively challenged at the Labour party conference, held at the weekend, where former rival David Cunliffe did not publicly support him.

This turn has been repaid to Cunliffe by Shearer demoting him to the unranked section of caucus.

Shearer said he had called his MPs together today to endorse his leadership "because I want any speculation or doubt about my leadership to be put to rest".

"That has now happened. I enjoy the confidence of my caucus today and going forward. Labour is a team. We're here for New Zealanders and that's bigger than the ambitions of any single individual.

Any impression of division was a distraction for the party, he said.
‘‘We must work together in the interests of New Zealand."

Shearer said he had laid out a "bold plan" at the weekend to "take New Zealand in a new direction" but to do that he needed a caucus that was "fully behind me".

"Sadly David Cunliffe has not been able to show that loyalty.

"His actions at the weekend were disappointing, not only to me but to many party members. That, along with his repeated failure to quell speculation about the leadership means that I no longer have confidence in him.

"He has lost my trust."

Cunliffe was today demoted from the front bench and stripped of his economic development and associate finance portfolios.

"After the leadership contest last year, I publicly expressed my support for David Cunliffe and appointed him to the front bench as a sign of my respect for him and desire for us to work together.

"I regret having to take the action I have today, but he has left me with no alternative."

Shearer said there was a road back for Cunliffe, but would not say what his MP's reaction was when he informed him before the caucus meeting that he would be demoted.

The Labour caucus will again vote on its leadership in February, but Shearer was confident he would win then too.

When asked if he would demote Cunliffe loyalists too, Shearer said he had no plan to do that.

In the days ahead Shearer said he would be talking to other MPs and he would be announcing a replacement for Cunliffe in the economic development portfolio.

A wider reshuffle will be made at a later date, but Shearer would not confirm that before Christmas.

CUNLIFFE WRITES POST FOR SUPPORTERS

Cunliffe avoided most media but took to Facebook to communicate with his supporters following the caucus vote.

"I wish I could express my gratitude for your kindness and my wish that we all might work together for a better New Zealand.

"Unfortunately I am not at liberty to comment further at this time," he wrote.

Richard Stowell commented that it was not yet Cunliffe's time, while someone posting under the account Broadway Hair suggested there was space for Cunliffe to return: "don't worry we want your actions in the future. Lets see where the polls take David Shearer for what he has done today".

KEY PICKS CUNLIFFE COMEBACK

Prime Minister John Key has predicted that Cunliffe would be back to challenge Shearer.

The prime minister watched the urgent vote play out from Cambodia.

Labour appeared to have a deeply divided caucus, he said
"They fundamentally don't like each other and can't agree on the direction they are going in ... yip, they'll put a united front on it today, but that's not going to fool anyone.

"At some point in the future David Cunliffe is coming back after David Shearer."

He wouldn't comment on Shearer's handling of the challenge, but couldn't resist a dig, adding: "They are consumed by the inner workings of the Labour Party and we are focused on what's happening here on the global stage; and how we can advance New Zealand's position in the world."

- © Fairfax NZ News