Shadow chancellor John McDonnell has been accused of leading a “silent coup” against Jeremy Corbyn.
Labour insiders told The Sunday Times Mr McDonnell has replaced the Labour leader “in all but name” after launching his own policy platform as the party prepares for a general election.
A source claimed he has also drawn up a list of appointments he wants in the leader of the opposition’s office.
“McDonnell is now basically the leader of the Labour Party,” said one insider.
“It’s a silent coup. He’s getting his own people in, isolating and picking off the old guard around Corbyn.”
It comes despite Mr McDonnell saying on Friday that he and Mr Corbyn would stand down if Labour loses the next election.
Mr Corbyn’s election to leader in 2015 was a major coup for the left wing of the party.
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But Mr McDonnell said he “can’t see” how he or close ally Mr Corbyn could continue to lead the party if they failed to win power after the next general election.
He made the comments in an interview with former Labour spin doctor Alastair Campbell for GQ magazine.
“I can’t see… I think it is the same for my own personal position, I can’t see so,” he told Mr Campbell, on the subject of either himself or Mr Corbyn carrying on in their roles after an election defeat.
“What we’d do is as the tradition, which is have an election for a new leader.”
Shadow cabinet minister Mr McDonnell said a woman should take over from the current leader and named shadow education secretary Angela Rayner as a possible successor to Mr Corbyn.
“I’m still of the view now that whoever comes after Jeremy has got to be a woman,” he said.
“We’ve got to have a woman leader. If you look at the new youngsters that have come through, they are fantastic.”
He added: “There is a whole range of women. Angela Rayner… There is a whole range of women and it’s fantastic.”
Despite discussing the process for replacing Mr Corbyn, the Labour number two said the Opposition party could “win a majority”.